Over the past several years, environmental, social and governance (ESG) initiatives took the business world by storm. The bottom line was no longer all that mattered. Customers and investors alike wanted to know how companies were tackling a host of ESG issues, from climate change to diversity, equity and inclusion.
More recently, the model has come under increasing fire. Political attacks on ESG principles combined with shaky macroeconomic conditions, a stronger push for profit over growth and an energy crisis in Europe gave some companies cover for cutting back on their promises, especially if they weren’t entirely committed from the start.
To be clear, many companies are making great strides in cutting their carbon pollution, an effort that falls under the larger umbrella of ESG considerations. That could include using cleaner energy sources for manufacturing, more environmentally friendly packaging for consumer goods or selecting cloud providers that strive to run the most energy-efficient data centers.
However companies approach becoming a greener organization, the question is whether they are staying true to their pledges, especially as economic conditions tighten. For some, ESG commitments are more about appearances than action. Unfortunately, the 2023 Google Cloud Sustainability Survey suggests that executive resolve is slipping. That, or those who were only in it for the marketing benefit are starting to come clean.
For proof, the survey found that this year, economic pressures have pushed ESG concerns down to the third position on the list of organizations’ priorities, from the top slot they occupied last year. “Many executives point to the macroeconomic environment and pressure from external parties to cut corners in their sustainability initiatives and prioritize client relationships and driving revenue,” the report stated.
Google commissioned The Harris Poll to survey 1,476 VP and C-suite executives from across the world in a variety of industry sectors. The report found that the number of sustainability projects being implemented, as opposed to merely planned, was down 8% from last year.