The year 2024 was a whirlwind of change, setting off a domino effect that reshaped sustainability goals and disrupted long-term projections. So, what does this mean for the business world moving forward? How have these shifts redefined corporate sustainability and ESG strategies? As we look ahead to 2025 and beyond, here are 10 key trends that will shape the future of sustainable business—ones you can’t afford to ignore.
Economic mood swings in Europe - Investors and businesses are pessimistic about GDP growth due to lagging productivity, sparse innovation, and diminished global competitiveness (WEF,2025). Views on how to handle the downturn are misaligned at a macro level, leading to erratic business activities and the deprioritization of sustainability. Tail risks swing to the left and right, creating difficulties for any long-term strategy.
Geopolitical unrest on all fronts - Geopolitical tensions are impacting trade, supply chains, and international relations. Sustainability leaders must consider energy security, resource and supply agility, affordability, and sustained economic growth in their strategies. The good news for heavily regulated countries is that multiple crises can sometimes create more policy flexibility. (Harvard Gazette and EU)
Global policy misalignment - Europe is standing firm on its Green Deal, working to simplify and reform policies and reporting to bolster their competitive compass. Meanwhile, post-election outcomes in over 60 countries point to deregulatory actions and the dismantling of laws that support climate mitigation and social justice—more a wipe-out than a reform (OECD and WEF)
Corporate pullback of ESG and sustainability - We’re witnessing a global retreat from sustainability initiatives, as organizations face pushback—and sometimes backlash—that threatens financial stability. We are seeing this already with large corporations eliminating DEI initiatives and exiting global and industry climate coalitions. Despite having dedicated resources for sustainability, many companies are now walking back their goals and stances on various sustainability topics. (Forbes and Forbes)
Uneven energy transition - Several key countries have deprioritized their green energy plans in favor of economic development, tariff disputes, and a degree of protectionism. This domino effect is hitting hard-to-abate sectors the hardest, derailing their climate mitigation strategies and goals. As governments and businesses remain unaligned, the energy transition market becomes increasingly unprofitable and unstable. (euronews).
Rising sustainability costs - Depending on sources and calculations, the average mid-to-large-sized company spends between €280,000 and €500,000 annually on CSRD and ESG disclosures. This cost continues to rise and is heading toward a tipping point, due in part to labor-intensive data collection and existing skill gaps. (ECS and Position Green and Fintech Global).
The climate finance abyss - Investments often focus narrowly on climate impacts while overlooking societal effects; many ventures lack viability and practicality, making this a risky business for an emerging market. Bottom line, countries and institutional investors are not “taking the medicine” they are pressuring the private capital sector to swallow. Without an aligned direction, the climate market is set for failure unless swift intervention occurs. (UNCTA).
Workforce unrest - Large institutions worldwide—including in the Nordics—report a deteriorating state of human capital. Geopolitical tensions, mental health and burnout, the cost-of-living crisis, detachment or “quiet quitting,” and skill gaps have emerged as five common core challenges that hold negative effects on business. (OECD and UNDP and WEF).
Social discord among G7 countries - At the start of 2025, G7 nations have seen flooded news streams on heightened political polarization, disparities in basic human needs, job displacement, cost-of-living crises, censorship, unwarranted surveillance, and public safety concerns. This unrest is likely to spill over to other countries, creating a domino effect and disruptions for industries heavily reliant on social stability. (CFR and USDS and UN)
Internal power struggles over sustainability - Internal tensions around sustainability integration are not uncommon, though rarely made public. Corporate sustainability leaders often face trade-offs in autonomy and mandate. As organizations expand sustainability integration into their businesses, misaligned goals and power struggles are on the rise. If stakeholders fail to find common ground, there’s a risk that sustainability and ESG initiatives could be scrapped altogether—though it’s too early to predict the full impact.
Identify the trends most likely to affect your business and operations. Gather the insights you’ll need when cutting costs and evolving your sustainability and ESG strategy. Next week, we’ll explore how to navigate sustainability in a cost-conscious era. In our post, “Sustainability Is No Longer Sustainable for Businesses, but It Can Be,” we’ll share insights on how to approach cost cutting and maturing sustainability in the most effective way.
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