Top 10 ESG Trends to Watch in 2024 – Part 1

Environmental, Social, and Governance (ESG) considerations are becoming more central to business strategies and investment decisions as we progress through 2024 and into the next year. Companies and investors alike are recognising the importance of integrating ESG factors into their operations, not just for ethical reasons but also for long-term financial performance. 

So what are some of the factors at play? Here’s our take on the top 10 ESG trends for 2024:  

1. Climate Action and Net-Zero Commitments

With increasing pressure from regulators, investors, and consumers, companies may be setting ambitious targets and working on actionable plans to reduce their carbon footprints. Some businesses will be focusing on decarbonising their supply chains and investing in renewable energy sources. 

2. Circular Economy Initiatives

The shift towards a circular economy is gaining momentum, with organisations moving away from the traditional ‘take, make, dispose’ model. You can expect businesses to adopt circular practices such as product recycling, refurbishing, and sustainable packaging. This is a trend driven by both environmental concerns and the desire to minimise waste. 

3. Sustainable Finance and Green Bonds

Sustainable finance continues to grow with green bonds, social bonds, and sustainability-linked loans gaining popularity. Investors may prioritise companies that demonstrate strong ESG credentials. 

4. Biodiversity and Natural Capital

With increasing pressure to prevent further biodiversity loss on our planet, some companies are going to be focusing on preserving natural capital and integrating biodiversity considerations into their ESG strategies. This includes adopting nature-positive practices and investing in conservation efforts, especially where it’s easier to align these with business goals. 

5. Human Rights and Supply Chain Transparency 

With stronger regulation around modern slavery in some parts of the world, consumers and investors are increasingly demanding greater transparency in supply chains, particularly concerning human rights and labour practices. This is leading to the rise of responsible sourcing initiatives and the adoption of technology to monitor and report on supply chain practices. 

Stay tuned for Part 2, coming soon!