I love this time of year, when the annual sustainability trend reports start coming out. The latest reports match what we're hearing from clients and seeing across our network. Companies are staying committed, but they are asking harder questions of every program. Only 8% of leaders who adjusted their strategy scaled back their goals (Reuters). 78% of executives increased sustainability investment this year (Deloitte). And 87% of S&P 500 companies that published a sustainability report last year did so again this year, even though only 32% issued a press release to announce it, down from 62% in 2022 (Teneo).
Here are the ten recommendations we are making to our clients.
Read more: 8 midyear sustainability trends
Start with the business objective: reducing cost, protecting revenue, or driving growth. Then manage sustainability as a portfolio. Scale initiatives that have a clear owner and a measurable return, and pause those without one.
Companies are already moving this way. Deloitte found the average number of sustainability initiatives fell from 5.0 to 3.4 in a single year. Only 18% of executives now describe their approach as business model transformation, down from 40%.
CSOs see a perception gap at the top. 65% say their C-suite still views sustainability primarily as a compliance obligation, and only 41% say leadership sees it as a source of growth (WEF). A clear value objective is how that perception changes.
Executives believe in the returns, but they struggle to prove them. 77% of executives told Deloitte their sustainability investments outperform their other investments. Yet practitioners told Reuters that difficulty quantifying returns is one of their two biggest budget barriers.
The pressure to close that gap is rising. Two-thirds of CSOs expect corporate decision-making to shift further toward short-term performance over the next year. A stronger business case is the top factor they expect to accelerate progress (WEF).
Closing that gap does not require perfect data or a larger budget. Track value across revenue, cost, risk, resilience and brand using the data already available, so that harder-to-quantify work is not cut by default.
Energy is the clearest example. PwC reports energy price increases of 7% to 25%. It finds companies are spending less on decarbonization while getting more from it, mainly by prioritizing high-return projects that reduce energy demand. In BSI's survey of UK businesses, cost savings and operational efficiency (37%) now outrank every other driver of net zero action. ERM describes energy security as a core priority alongside decarbonization. When energy costs and supply are board-level concerns, efficiency is where the sustainability case and the business case are easiest to make together.
Read more: The cost of doing nothing on sustainability
Companies are speaking about sustainability more carefully. 71% of leaders who adjusted their strategy changed their language rather than their goals (Reuters). "ESG" now appears in just 4% of S&P 500 report titles, down from 35% in 2022. Reports are also being published later in the year, likely reflecting additional legal review (Teneo).
A quieter external posture is reasonable. Silence is not. Employees, investors, and customers still need to see progress. Maintain a deliberate internal and investor communications plan, and make sure every public claim is defensible.
Read more: Greenwashing risk is shifting, not shrinking. Here's how to stay ahead.
External assurance is now standard practice. 75% of S&P 500 companies obtained it in 2026, up from 54% in 2022, and 63% now publish standalone data tables (Teneo).
Supplier data remains the weak point. Only 11% of organizations are very confident in it, and 27% have no formal traceability approach (Reuters).
Treat supplier data verification as a compliance investment now, before due diligence requirements and assurance scopes catch up with it.
Read more: Third-party assurance for sustainability reporting: What it is and why it matters
Reporting is now a multi-framework exercise. GRI remains the most widely used standard, referenced by 40% of large listed companies worldwide, representing 62% of global market capitalization. Most of those companies pair it with others: 80% of companies referencing ISSB and 83% referencing SASB also report with GRI (GRI). In the U.S., ISSB alignment nearly doubled to 14% of S&P 500 companies this year (Teneo).
The landscape is also diverging by region. Framework use dipped in Europe and North America this year, partly as EU companies moved to ESRS. It rose across Asia, Africa, and Latin America (GRI).
Nature is the next test. More than 1,000 organizations across 56 jurisdictions now make TNFD-aligned disclosures, double last year's count, and investors are asking for location-specific data (TNFD). Yet only 14% of sustainability professionals call nature and biodiversity a very significant priority for their company (GlobeScan/BSR). If nature disclosure follows climate's path from voluntary to expected, companies that start collecting the data now will be better placed.
Build one well-governed data set that can serve investors, regulators, and customers across frameworks and markets, and that can extend to nature without starting over.
Read more: Which sustainability reporting framework is right for your company?
As deadlines arrive, more companies are acknowledging where they have fallen short. The share of S&P 500 companies signaling an off-track goal rose from 9% to 12%. The share repositioning a goal rose from 2% to 12% (Teneo). Two-thirds of those goals were environmental.
Revising a goal quietly, without explanation, is a credibility risk. Explain what changed, what you learned, and what the path forward looks like.
Read more: What changed in SBTi's latest Communications Guidance
Physical climate risk is now the sustainability issue affecting companies most. Yet only about a third of companies have fully integrated it into enterprise risk management, and nearly half lack visibility beyond their direct suppliers (Deloitte).
CSOs expect this to intensify. 85% expect adaptation to become a greater focus over the next three years, and 42% name insurance cost and availability among their most vulnerable points. Yet 62% say uncertain cost-benefit assessments are holding back adaptation investment (WEF). The case for resilience has to be made in financial terms.
Assign clear ownership for physical risk. Stress-test critical sites and suppliers. Integrate both into risk management and capital planning.
Read more: The NGFS climate scenarios: a practical translation of climate risk
AI is already improving sustainability work. 47% of practitioners say it frees time for more strategic priorities (Reuters).
Governance has not kept pace. 55% of S&P 500 companies mention an AI governance policy, but only 12% describe it in any detail (Teneo). Just 12% of organizations have a framework that covers AI's environmental and social impacts (Reuters).
CSOs see both sides. 73% expect AI to be an important driver of sustainability progress, while 77% name the energy and resource intensity of AI infrastructure as its biggest environmental risk. 68% expect skills gaps to limit their ability to use it, and 48% cite a lack of reliable data (WEF).
AI's energy and water demands make it a sustainability issue. The time to secure a role is now, while frameworks are still being written.
Read more: The case for responsible AI
Sustainability oversight is shifting. General Counsels now hold primary responsibility at 23% of S&P 500 companies, while CEOs fell from 28% to 19% (Teneo). The CSO title is consolidating. Only 3% of organizations have removed the role entirely (Reuters).
Day-to-day connections are thinning as well. Sustainability teams report less engagement with 11 of 16 business functions than a decade ago, with the steepest decline in the CEO's office (GlobeScan/BSR).
Titles and owners will continue to change. Direct access to the CEO and board is what sustains influence.
Read more: How sustainability teams can speak so communications team will listen
Focus is healthy, but it carries a risk. Deloitte found the largest declines this year were in new sustainable products, sustainable materials, and emissions reductions. These are the areas with the greatest long-term upside.
World Economic Forum research estimates the green economy surpassed $5 trillion in annual value in 2024. Companies' green business lines are growing roughly twice as fast as the rest of their operations (WEF).
Capacity also means people. 44% of sustainability professionals say their jobs are less fulfilling than two years ago. Only 47% see corporate sustainability as the most attractive career path over the next five to 10 years (Trellis). Just 18% expect their sustainability budget to increase in the next cycle (GlobeScan/BSR). Teams being asked to prove ROI, prepare for assurance and govern AI need the room to do that work well.
Set aside a portion of budget for initiatives that do not yet have a proven return, and protect the team that will deliver them. Discipline should not become retreat.
Read more: Why sustainability still sells
The retreat narrative makes for compelling headlines, but the data points elsewhere. Companies remain committed. They are more selective, more careful in how they communicate and more focused on results. That is what it looks like when sustainability becomes part of how a business operates rather than a separate program. As the World Economic Forum's CSO Outlook puts it, sustainability "is no longer a commitment to be made; it is a capability to be embedded in growth, competitiveness and resilience."
If you are deciding which initiatives deserve investment, how to demonstrate their value, or how to communicate progress credibly, we would welcome the conversation.
Read more: The sustainability retreat is over
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In her 13 years with the thinkPARALLAX, CEO Janna Irons has helped shape the firm's services, positioning, and growth. She has worked with clients across industries, including WM, Alaska Airlines, Lilly, Interface, and Keurig Dr Pepper, helping guide sustainability strategies, build engaging narratives, and leverage sustainability to drive performance, engagement, and business results.