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Despite ongoing investment in climate initiatives and public commitments to reducing emissions, climate change is not the top priority for ESG investments among businesses in Greece.
How do large companies in Greece approach sustainability in a period of global economic slowdown and uncertainty? How are their climate goals, ambitions, and investments affected? What are the challenges they face, and which factors either support or hinder their initiatives? Ultimately, how can they create value through their efforts to address climate change?
In today’s global landscape of economic and geopolitical uncertainty, it is understandable that many organizations prioritize addressing short-term challenges, often at the expense of their climate initiatives. In fact, according to the second edition of the EY Sustainable Value Study Greece 2024, climate change is not the top priority for ESG investments among businesses operating in Greece. However, companies in Greece recognize that climate change is an existential threat requiring urgent action, while they remain committed to reducing their emissions. Moreover, respondents acknowledge that their climate initiatives deliver higher financial value for their organizations than initially expected.
Ambitious climate goals and significant investment
The vast majority of respondents stated that their companies have committed to reduce carbon emissions by a specific amount (88%) or achieve carbon neutrality (84%). Additionally, 72% reported that their organizations have committed to achieve negative emissions, while 49% have committed to net-zero. Despite the uncertain global economic landscape and external pressures, most respondents indicated that their organizations have not changed their emissions reduction targets (90%) or the year by which they have committed to achieve their climate change ambitions (84%).
The majority of respondents,
indicated that their organizations have not changed their emissions reduction targets.
At the same time,
stated that their organizations have not changed the year they have committed to achieve their climate change ambitions.
Notably, climate-related spending is expected to remain about the same or increase significantly or moderately compared to last year, with 91% of respondents supporting this view.
However, when asked to estimate their organizations’ spending for the next year, 63% stated that they would expect an increase. This comparison suggests that businesses might be adopting a more cautious approach to climate-related investments.
At the same time, executives remain optimistic about achieving their organizations’ climate change targets: 56% believe that global emissions will decrease by at least 45% by 2030 (compared to the 2010 baseline), while nearly two-thirds (65%) consider their organization ambitious enough to make a meaningful impact on climate change. Additionally, 64% are confident that their company will achieve its public climate change commitments within the set timeframe. Artificial intelligence (AI) is also recognized as a crucial tool for optimizing supply chains and reducing carbon emissions, with 60% acknowledging its significance in these efforts.
ESG priorities – a differentiated approach for companies in Greece, compared to the global sample
Respondents in Greece significantly differentiate from their global counterparts regarding their ESG investment priorities for the next 12 months. While climate change is the top priority worldwide, it ranks third in Greece, with only 37% of respondents identifying it as a focus area.
Instead, a key priority for respondents in the Greek survey is community impact, human rights, and labor standards, cited by 45% — significantly higher than the global average of 29%. Traceability and supply chain risk management follows at 40%.
On the other hand, nature and biodiversity (32%), and circularity and resource efficiency (31%) rank lower.
Climate change initiatives, sustainability, and long-term value creation
The majority of respondents believe that the value their companies captured from climate change initiatives exceeded initial expectations. Specifically, 61% reported that these efforts created higher than expected value for customers, while 56% saw increased value for society. Additionally, 49% stated that their companies also experienced higher financial value than expected.
Participants were also asked about the key stakeholders and broader factors that either act as barriers or accelerators to their organizations’ sustainability initiatives. Investors (64%) and customers (45%) were identified as the main accelerators of sustainability initiatives, followed by NGOs and other civil society organizations (41%), and employees (39%). However, 23% of respondents noted that customers may pose as barriers to such initiatives.
Skills and talent availability (56%), and data and technology availability (56%), were also considered as accelerators by respondents, and to a lesser extent, the integration of sustainability across functions (45%), their corporate strategy or business model (44%), and the availability of government subsidies or incentives (44%).
Based on the Greek findings and the expertise of the EY Sustainability Services teams, the survey presents a series of recommendations to help businesses in Greece improve their sustainability performance. These recommendations follow the "value-led sustainability" approach — that is, sustainability resulting from policies designed with the goal of creating value for everyone; society, the planet and business. The key focus areas are:
- Strengthening the role of the Chief Sustainability Officer (CSO)
- Leveraging regulatory frameworks and sustainability reporting
- Focusing on Scope 3 emissions
To achieve their sustainability goals, businesses must also intensify their efforts in governance and oversight, measurement and reporting, operations, as well as in actions related to customers and products, suppliers and third parties.
Summary
The EY Sustainable Value Study Greece 2024 examines how businesses approach sustainability and climate change action, identifying the key focus areas, the targets, and capturing the progress made so far. The study also explores the challenges businesses face and the factors that either act as barriers or accelerators to their sustainability initiatives.