CEOs Prioritize Sustainability Despite Economic Challenges: EY Survey Reveals

A recent survey conducted by global professional services firm EY sheds light on the shifting priorities of CEOs regarding sustainability and decarbonization. According to the findings released by EY, sustainability has emerged as a higher priority for more than half of CEOs globally, with decarbonization identified as the top long-term strategic focus.

EY's CEO Outlook Pulse Survey, which polled 1,200 CEOs from large companies across 21 countries and five industries, along with 300 institutional investors, revealed significant insights into the mindset of corporate leaders regarding sustainability initiatives.

The survey highlights that 54% of CEOs reported an increased prioritization of sustainability within their organizations compared to the previous year. However, it also notes that 23% of CEOs acknowledged deprioritizing sustainability efforts, primarily due to economic or financial challenges.

Regionally, respondents from the Americas showed the highest inclination towards elevating sustainability priorities, with 62% reporting an increased focus, while only 16% indicated a decrease.

Interestingly, while sustainability-related issues were identified as more of a long-term focus for CEOs, with decarbonization topping strategic priorities over a three-year horizon, short-term concerns such as investing in technology and AI to drive growth and productivity took precedence over the next 12 months.

Andrea Guerzoni, EY Global Vice Chair—Strategy and Transactions, emphasized the importance of aligning short-term financial goals with long-term sustainability targets. Guerzoni expressed disappointment over the proportion of CEOs moving sustainability down their business agenda, cautioning against short-sighted decision-making.

Furthermore, the survey highlighted a disparity in views between CEOs and institutional investors regarding sustainability priorities. While 28% of investors reported an increased focus on sustainability, 35% indicated a lower priority. Additionally, there was consensus among both CEOs and investors regarding challenges such as greenwashing, stranded assets, and consumer behavior alignment with sustainability goals.

Despite these challenges, both CEOs and investors agreed on the potential of technology and AI to address key sustainability challenges facing their organizations.

Guerzoni emphasized that achieving sustainability targets is not only a financial imperative but also a shared commitment across the corporate landscape. She urged companies to remain steadfast in their pursuit of sustainability goals, even in challenging market conditions.

EY's survey underscores the evolving landscape of corporate priorities, with sustainability taking center stage despite economic uncertainties. As CEOs navigate the complexities of balancing short-term financial objectives with long-term sustainability commitments, the importance of collective action toward a sustainable future becomes increasingly evident.