ESG investments, climate change risks and the path to Net-Zero by 2022 are already shaping a number of important trends and legislation beyond the rhetoric that will impact private and public sector organizations in 2023.

In addition, these trends took into account the recent results of a specialized study by the Center for Sustainability-CSE in Europe and North America, which examined the reasons why “business as usual” is no longer a viable option and the shift towards a “sustainable way of doing business”. ” – the only way.

Top six trends for 2023 for private and public sector organizations:

• Net-Zero roadmaps and energy transformation

According to Net-Zero Tracker, 91% of the global economy and nearly half of the top 2,000 companies have committed to net-zero emissions. However, the UN experts at COP27 provided a rather disappointing report as many of these commitments lack scientific rigor and no real progress has been made. By 2023, more investors will meet the standards set out in Article 9 of the SFDR Directive – these are funds aimed at sustainable investments or reducing carbon emissions. On the other hand, the war in Ukraine has dramatically changed the European energy system. This will increase the use of renewable energy sources, green hydrogen through new and existing sources and accelerate the search for energy efficiency solutions. Transformation of the EU energy system. will be a priority for 2023.

• Aim for stricter standards and disclosure ESG – data on reducing environmental impact

In 2023, more than ever, companies will focus more on evaluating what they must report in their annual reports, using EU SFDR regulation as a benchmark. which came into force on January 1, 2023, and the CSRD Regulation that follows (2024).

• ESG and business finance will become more interconnected

83% of institutional investors in Europe plan to increase investment in ESG products. In addition, regulators are determined to clear up the existing confusion about funds invested in ESG, while banks will be more demanding in financing companies that meet ESG criteria.

• Less focus on ESG ratings.

Familiarity with standards and assessments, as well as awareness of companies about them, has increased. The ESG ratings will lose their lead in 2023 as other requirements and legislation related to ESG criteria and climate are replaced.

• Increased control over greenwashing and the requirement for transparency

Greater disclosure by companies through their sustainability reports and any other form of corporate communication may lead to more accusations of false or misleading statements. Corporate Sustainability Reporting Directive (CSRD) and other relevant EU directives. designed to address these shortcomings. In addition, by 2024 at the latest, all countries that have ratified the Paris Agreement will need to follow a single, universal process to ensure transparency.

• Circular economy and zero waste

Reducing packaging waste is a major trend in 2023, which should bring a number of new materials to market. Nearly two-thirds (59%) of consumers make conscious choices by purchasing products that use more sustainable practices. Technology will be at the forefront of these changes, providing opportunities for the development of bioplastics, biomaterials or water-soluble packaging.

Mr. Nikos Avlonas is President of the Center for Sustainability (CSE), and is a visiting professor at the University of Economics in Athens (IMBA) and the University of Illinois at Chicago.