In today’s world, sustainability is a strategic priority that impacts investor confidence, customer loyalty, and overall business resilience. As environmental, social, and governance (ESG) expectations rise, businesses must adapt to stay relevant and competitive.
BearingPoint has identified three pivotal trends redefining sustainable business practices. Each trend represents not just a response to regulatory demands but an opportunity and crucial factor for success for companies to innovate, cut costs, and build lasting trust with consumers. Here’s how forward-thinking businesses are setting the stage for a more sustainable future—and why these trends should be on your radar for 2025 and beyond.
Top 3 Long-Term Sustainability Trends
- ESG Reporting
- Supply Chain Transparency through Sustainable Procurement
- Circular Economy
ESG Reporting
ESG reporting has become a cornerstone of responsible business practices, providing investors, consumers, and regulatory bodies with transparent data on a company’s environmental and social impacts. As 70% of investors now consider climate change a key factor in decision-making, companies that prioritise ESG are more likely to attract investment, retain consumer loyalty, and mitigate reputational risks. Additionally, consumers are increasingly willing to pay more for products from companies that demonstrate environmental responsibility, making ESG transparency a strategic advantage.
Governments worldwide are introducing stricter regulations, such as the EU's CSRD, CSDDD, Taxonomy and the UK’s Sustainability Reporting Standards, which make ESG compliance mandatory. ESG reporting enables companies to improve decision-making, track performance, and stay ahead of regulatory requirements, positioning them as leaders in sustainability.
How to successfully implement ESG reporting
- Data Management: Centralising ESG data improves accuracy and enables streamlined reporting.
- Automation: Automated tools reduce human error and ensure timely, consistent updates to ESG metrics.
- Regulatory Compliance: Align your reporting practices with current and upcoming regulations, such as mandatory climate disclosures.
- Stakeholder Engagement: Ensure transparency by making ESG progress accessible to both internal teams and external partners.
- Benchmarking & Performance Tracking: Regularly track ESG performance to measure progress and identify areas for improvement.
- Risk analysis: Conduct a Double Materiality Analysis to identify ESG risks and opportunities to shape your organisation's strategic focus.
Supply Chain Transparency through Sustainable Procurement
Consumers and stakeholders are increasingly scrutinising supply chains, wanting assurance that products are ethically sourced and environmentally responsible. With 62% of Gen Z and Millennials looking for sustainable options when shopping, businesses with transparent and sustainable supply chains gain a competitive edge.
As governments enforce stricter regulations on sourcing, particularly concerning human rights and environmental protections, businesses face rising expectations to comply. The upcoming CSDDD regulation will give clear requirements and guidelines as to what data and information needs to be disclosed. Sustainable procurement practices enhance supply chain resilience, reduce operational risks, and foster trust among consumers and investors.
How to build transparent supply chains through sustainable procurement
- Real-Time Data: Use platforms to track supplier practices, ensuring they meet ESG compliance standards.
- Supplier Collaboration: Engage suppliers in sustainability goals to create long-term partnerships aligned with your values.
- AI & Automation: Leverage AI-powered tools for real-time risk analysis, ensuring compliance and minimising supply disruptions.
- Sustainable Sourcing: Implement circular procurement principles to minimise waste and encourage recycling and reuse.
Circular Economy
The traditional “take-make-dispose” model is increasingly unsustainable, leading many companies to embrace the circular economy—a model designed to extend the lifecycle of products through recycling, reusing, and innovative design. Circular business practices reduce waste, lower carbon footprints, and enhance resource efficiency, offering companies a pathway to cut costs and attract eco-conscious consumers.
The global resale market, for example, is expected to grow five times faster than retail over the next five years, reflecting a surge in demand for secondhand products. Additionally, research shows that up to 80% of a product’s environmental impact is determined at the design stage, making it crucial for companies to prioritise sustainable product design from the outset.
How to successfully implement a circular economy model
- Product Design: Design products for durability, repairability, and recycling to extend their lifecycle and reduce waste.
- Waste Reduction: Reuse, recycle, and upcycle materials, turning waste into a resource that can re-enter the production cycle.
- Compliance with Circular Economy Regulations: Stay proactive in meeting regulations like the AGEC law, which promotes waste reduction and sustainability.
The future of business is sustainable, with ESG reporting, supply chain transparency, and circular economy practices shaping industry standards. We know that these steps are not easy to take and come with uncertainty, but we see that clients and companies that adapt to these trends are gaining a completitive advantage, building resilient supply chains and strategies, cutting costs, and creating lasting consumer trust, positioning themselves as leaders in an evolving marketplace.
