Climate change top priority for Indian CxOs

The recently released Deloitte’s 2023 CxO Sustainability report shows that tackling the impact of climate change is a top priority for top Indian company executives (CxOs), who have ranked it higher than economic outlook. At least 57% of the Indian CxOs said climate change is among the top three priorities, compared to 42% of global CxOs.

As an India Today report points out, the Deloitte survey finds that around 81% of the Indian CxOs said they have increased sustainability investments from last year, with 27% saying that investments have risen significantly. This increase in investments could be attributed to the fact that 53% of these Indian CxOs surveyed believe that climate change is likely to impact their companies’ strategies and operations to a “high/very high” degree over the next three years.

The India Today report states that the Deloitte survey further highlighted that 60% per cent of Indian CxOs rated a “just transition” to be extremely important to their organisation’s sustainability efforts, as compared to 46% of the polled global executives. A just transition seeks to ensure that substantial benefits of transitioning to a green economy are shared widely, while also supporting those who stand to lose economically — whether countries, regions, industries, communities, workers, or consumers. When it comes to stakeholders’ expectations regarding climate change, Indian organisations are feeling a moderate to high degree of pressure to act on climate change among various stakeholder groups.

Compared to the global average, Indian CxOs are likely to report feeling more stakeholder pressure to act from board members (78%), the government (72%) and shareholders (71%). The CxOs further added that the changing regulatory environment and employee activism have increased their organisations’ sustainability actions over the past year. As far as climate actions are concerned, Indian CxOs are more likely to be focussed on increasing the efficiency of energy use, using more sustainable materials, using more energy-efficient equipment, training employees, and making operations/supply chains more climate-resilient, in comparison with their global peers.

Deloitte’s website states that their survey of more than 2000 CxOs across 24 countries finds that the majority of CxOs remain optimistic the world will take sufficient steps to avoid the worst impacts of climate change and feel a sense of urgency to take action. It found that almost every organisation has felt the impacts of climate change over the past year, and CxOs have been personally impacted.

Deloitte built upon past research by surveying more than 2,000 CxOs across 24 countries to gauge concerns and actions from business leaders on climate change and sustainability. The report also identifies key recommendations for organisations to help close the gap between ambition and impact in order to accelerate progress to a low-carbon economy.

Organizations are feeling broad pressure to act on climate change from across their stakeholder groups, according to the survey. 68% of the CxOs said they feel a large-to-moderate degree of pressure from each of the following groups: board members and management, regulators and government, and consumers and clients. Organisations are also feeling pressure from their shareholders and investors (66%), employees (64%), and civil society (64%).

The CxOs reported “resource scarcity/cost of resources” as the top issue already impacting their companies (46%), while 45% highlighted “changing consumption patterns or preferences related to climate change” and 43% reported “regulation of emissions” as other top issues impacting their companies. Additionally, around a third of executives said climate change is negatively affecting their employees’ physical (37%) and mental (32%) health. When asked to rank the issues most pressing to their organizations, many CxOs rated climate change as a “top three issue,” ahead of seven others, including innovation, competition for talent, and supply chain challenges. In fact, only economic outlook ranked slightly higher. Many CxOs (61%) said climate change will have a high/very high impact on their organisation’s strategy and operations over the next three years. 75% said their organisations have increased their sustainability investments over the past year.

While 78% of the leaders are somewhat/extremely optimistic the world will take sufficient steps to avoid the worst impacts of climate change, 84% agreed/strongly agreed the world can achieve global economic growth while also reaching climate change goals.

Listing the top actions taken by their companies as part of their sustainability efforts, using more sustainable materials (e.g., recycled materials, lower-emitting products) stood at 59%, increasing the efficiency of energy use (e.g., energy efficiency in buildings) at 59% again, using energy-efficient or climate-friendly machinery, technologies, and equipment at 54% and training employees on climate change actions and impacts at 50%.