Sustainability trends 2024: A change that companies must face

• Companies must put sustainability at the center of their philosophy and management activities in order to attract positive attention.
• The textile industry must focus on circularity, companies should deal more intensively with social justice and artificial intelligence, and CEOs must increasingly speak out publicly on relevant topics.
• Companies are experiencing a shift towards holistic integration at the enterprise level, while increased disclosure of Scope 3 emissions and understanding sustainability trends are critical for competitive advantage.

As last year, the COP28 climate conference, and wars and political turmoil around the world made clear, corporate engagement in shaping a non-market environment and managing environmental risks is critical.

In order to stand out as a successful and positive company in 2024, sustainability must be placed at the center of your corporate philosophy. Sustainable business models that combine profitability and social impact will be at the forefront. Many companies therefore have to work hard on their structures and procedures, also as the legal framework is being redefined. This will force companies to integrate sustainability. Here we present the upcoming sustainability trends to you:

Sustainability trends 2024:

1. Circularity in the textile industry
2. Social justice in companies
3. Use of artificial intelligence
4. Statements from CEOs
5. Sustainability at the corporate level
6. Disclosure of Scope 3 emissions

1. Circularity in the textile industry

In 2024, the textile industry's efforts to improve its sustainability will face a variety of challenges. Despite previous efforts in the areas of design, manufacturing and recycling, it is clear that these are not enough to sufficiently reduce the environmental impact. In the future, increased approaches to circular design, circular business models and the drastic minimization of production quantities will play a decisive role.

The textile industry must intensify its efforts in circular design and business models to achieve the ambitious goals of the Paris Agreement. In the design sector, the industry is subject to regulatory changes, particularly due to the EU strategy for sustainable and circular textiles. This includes eco-design requirements to promote sustainable product design.

A central focus is on the durability of products, which can influence a large part of the environmental impact. Increasing production volumes also pose a challenge. The textile industry must increasingly focus on circular models in order to address the problem of overproduction. Improved predictions, technologies such as 3D body scanning and partnerships with recyclers are important. In addition, closing the material cycle and promoting sustainable alternatives to conventional materials are necessary to reduce the water footprint in the industry.

2. Social justice in companies

Companies face the urgent task of addressing equity - be it climate, economic, racial or gender. The year 2024 calls for unambiguous terms and a profound commitment.

Previous approaches to social impact often seemed like superficial image improvements. Many social impact campaigns were nothing more than empty promises and were probably conducted by companies with their own ethical concerns. The justice agenda goes far beyond this, confronting companies with challenging questions about taxes, labor rights, exclusion, unionization and fairness in supply chains. In 2024, communication campaigns no longer need to be exclusively informative, but also captivating to be considered relevant.

Companies tend to prioritize “social impact” over “equity,” emphasize “livelihood” over “poverty,” and favor “inclusion” over “bias.” But this will change in 2024, as soon as Generation Z is majority represented in working life. The lack of equity in a company's sustainability strategy will raise serious questions about its contemporary direction in 2024.

3. Use of artificial intelligence

In 2024, the transformative power of artificial intelligence (AI) will be increasingly focused on tackling complex sustainability issues. AI is expected to not only optimize resource use and increase energy efficiency, but also minimize environmental impacts.

AI particularly develops its predictive abilities in biodiversity conservation. Machine learning models are intended to predict poaching threats and improve the protection of specific areas. In addition, AI is expected to support the analysis of extensive environmental data. This deepens society's understanding of ecological systems and the effects of climate change.

Another key area where AI is expected to play a key role in 2024 is ESG data management. With increasing sustainability disclosure requirements, companies are faced with the challenge of collecting and analyzing extensive amounts of ESG data. AI-powered ESG data management software is expected to play a critical role in streamlining this process while ensuring accuracy, efficiency and compliance.

4. Statements from CEOs

The demands on CEOs to take a public stance on relevant social and political issues have increased dramatically. According to a survey by Edelman, a majority of employees in Germany expect CEOs to take a position on issues such as employee treatment, climate change, inequality, discrimination and immigration. Regardless of the direct business relevance. But many CEOs are reluctant to take on this public role and struggle to find a clear position on highly polarized issues. Nevertheless, CEOs are expected to speak more intensively and publicly about the topics mentioned in the future, even if they have to use their reach with caution.

5. Sustainability at the corporate level

The transition from sustainability at the management level to holistic integration at the corporate level is well underway. In recent years, the focus has been on adapting to regulatory requirements in sustainability management and obtaining sustainability certificates. With the impending implementation of the EU Corporate Sustainability Reporting Directive (CSRD) and the US Securities and Exchange Commission's climate-related disclosures in 2024, change is imminent in this area.

Companies must adapt their reporting functions to meet the new requirements. A ready-to-use management system enables managers to focus more of their energy on entrepreneurial creativity. The focus is expected to shift from mere compliance to designing new products and innovative solutions for a sustainable future.

In 2024, we can expect a wave of pioneers and creative measures to increase innovation, and groundbreaking ideas will take center stage towards the end of the year.

6. Disclosure of Scope 3 emissions

Scope 3 emissions, the indirect emissions created in a company's value chain, are often the largest source of a company's carbon footprint. Unlike Scope 1 and 2 emissions, which are controlled directly by the company, Scope 3 includes all other indirect emissions from activities such as business travel, procurement and waste.

Disclosure of Scope 3 emissions will be in the spotlight in 2024, with increased calls for companies to publish them. The reason for this is interest groups demanding more transparency and action on climate change. Investors, customers and regulatory authorities are urging companies not only to report on their Scope 3 emissions, but also to actively reduce them.

This new flow of information requires robust data collection and collaboration with suppliers and partners to achieve change across the value chain. The reason for the increased attention is not only increased environmental awareness, but also new laws that require stricter environmental regulations and sustainability practices. Disclosure is a complex task, but increasing demand for decarbonization across the supply chain is driving innovation in product design, logistics and materials. Furthermore, this leads to a domino effect of sustainability improvements across all industries.

Sustainability trends: challenges and opportunities for companies

As the sustainability trends for 2024 continue to unfold, it is critical that companies understand, embrace and integrate developments and make a positive contribution to the global sustainability agenda. Understanding and implementing sustainability trends is not just a matter of compliance with regulations, but also crucial for a competitive advantage. The global race to standardize sustainability is becoming increasingly intense and companies that are at the forefront will gain significant long-term advantages and a leadership role in the area of ​​sustainability.

However, whether the sustainability trends mentioned for 2024 are actually happening cases or whether they are utopian hopes is in the hands of the companies.