US Election, Climate-Ready, Panel, Regulation & Secret Santa
Good Business - Sustainability | Strategy | Impact
November 8, 2024
1. Charting a path forward from this week's election result
It is hard to make sense of events in their immediate aftermath and many of us are struggling to organise our thoughts in the face of Trump’s resounding victory this week. But it seems clear that the legislative lines in the US will shift. The carrots and sticks for business will no longer promote climate action and a just transition. And it is highly likely that the new cultural hegemony will add considerable further fire to the existing ESG backlash. It is perhaps inevitable that some companies will take the opportunity to step backwards. And the number willing to put their voice to counter positions will decline.
But we think, hope and believe that the sustainability movement will withstand this.
There is solace to be found in recent history. In Trump’s first term the Black Lives Matter and Me Too movements gathered force, and sales of plug in and hybrid cars tripled in America. Wind generation also soared despite Trump’s claim that windmills cause cancer. And progressive businesses remained a powerful force – let’s not forget that it was in 2019 that the US Business Roundtable redefined the purpose of a corporation as being to create value for all stakeholders.
In more recent years the infrastructure around sustainability has grown ever stronger. From the SBTi to CSRD to B Corp, accountability is increasingly built into corporate action. Initiatives such as these embed a long-term view into the mandate for change, that runs far beyond a four-year term. And the nature, scale and urgency of the issues they are designed to address demands generational thinking.
This is not to suggest that nothing will change, or that the path forward will be at all easy. There is an enormous amount to fear.
But we hold on to the fact that business retains the power to create change. Brands can continue to find positive ways forward that connect with, inspire and empower their consumers. And the fact that companies are more intertwined with the broader prosperity of people and planet than ever before creates its own inexorable logic, particularly given the degree to which this hangs in the balance, and as the timescale for action grows ever tighter.
The drawing of this dividing line in the political sand may also provide additional impetus and motivation for those that disagree, driving them to move loudly in the opposite direction. When Trump last withdrew the United States from the Paris Agreement, many companies signed up to the principles to prove to the world that their values had not changed
So we look to our colleagues, clients, partners and friends to continue the battle with energy and force. We are open and up for forging new coalitions and creating alternative levers for change. And to working together to continue to search for creative, sensitive and meaningful ways to show how business can transform an ever-changing world.
2. Climate-ready 3.0
This week, Aviva launched its third annual Climate-Ready Index as part of its ongoing role supporting the UK, and the rest of the G7 and Ireland, to become more climate-ready (by which we mean the extent to which a country is doing what is necessary to both limit further damage to the climate and adapt to the negative effects of climate change, both locally and globally). We worked closely with the Aviva team to create the Climate-Ready Index back in 2022 and were delighted to continue our partnership highlighting the opportunities for positive change at a global scale for this year’s report.
The Index (and the concept of “climate-ready”) brings together the various challenges of climate change - often treated separately - including reducing greenhouse gas emissions, adapting industry, infrastructure and lifestyles to climatic events, protecting nature, and supporting businesses and society through the transition.
This year, the report features a deep dive on the fast-moving topics of nature and climate adaptation, exploring why protecting and restoring nature and adapting to climate change are critical to climate-readiness. From Sheffield’s Sustainable urban drainage system to Yokohama’s seagrass restoration scheme, we examine what’s working well, the barriers to success and the lessons that can be learned.
The good news is we are seeing more action and faster rates of improvement, as countries are transitioning towards a more climate-ready world. Germany retains its top position extending its lead from the rest of the pack. Despite being the second-biggest improver, the USA remains last—a position with which it will probably become very familiar considering recent events. And a positive story emerges for business – companies are taking more climate-ready action than they were 12 months ago. This year, across all countries, 50% of businesses surveyed have a structured plan with targets and actions to reduce carbon emission and 53% of businesses are taking action to protect operations against extreme weather.
But we still have a long way to go. This year the UK lost its top spot in both “emission and mitigation” and “adaptation implementation” due to changes in climate policy over the last 12 months, and national adaptation plans which fall short in defining coherent, specific and measurable goals.
We hope the findings and practical examples included in the report encourage countries to go further faster at a time where collective action is needed most.
3. Putting the G in ESG
Yesterday, our Senior Partner Claire joined a panel discussion with representatives from our friends at Echo Research, Mishcon de Reya and Avon International to explore whether governance is the secret weapon for transformation, drawing on insights from the second wave of research with our Sustainability Leaders Panel. The panel explored how to engage the board in sustainability, how to bring the business along on the journey and reflected on the likely impact of the US election and what happens when governance goes wrong.
As sustainability regulations proliferate, a new compliance floor has been set for companies and their value chains, demanding time, resources and attention. However, it seems that new regulations and disclosures are making sustainability teams’ lives harder, often encouraging a retreat from compliance rather than inspiring progress. So how do we turn the dial?
Governance isn’t a tick-box exercise: it a decision-making tool that can be used to ensure that real change happens. When done well, it drives and demands transformation. This is where the power of governance lies: in its ability to move a company from promises to progress. By embedding robust governance structures that distribute accountability and prioritise purpose, boards and directors can ensure that strategies and environmental and social commitments are put into action.
For those wanting some practical actionable insights from the discussion, our Managing Partner, David, has summarised them in a LinkedIn post here here.
4. Sustainability reporting just got real
A question we often get asked about the new reporting regulations that many clients are grappling with is “how is this going to be enforced?”. Well, the European Securities and Markets Authority (ESMA), the EU’s financial watchdog, has laid out its priorities, putting the Corporate Sustainability Reporting Directive (CSRD) front and centre. This year’s focus is on a robust implementation of the directive, with a strong emphasis on EFRAG’s double materiality approach – radical transparency isn’t just encouraged, it’s required. Double materiality means companies must assess both financial and broader social and environmental impacts, making their sustainability disclosures comprehensive and accountable.
Materiality assessments are foundational to effective reporting, influencing the completeness and accuracy of sustainability disclosures. ESMA has flagged this area for special scrutiny, with a call for companies to clearly show how they applied the concept of double materiality to identifying the issues they report on, especially when engaging stakeholders. ESMA wants transparency in how stakeholder feedback was gathered, prioritized, and incorporated. EFRAG’s materiality guidance, referenced by ESMA, underscores the importance of entity-specific information and clear alignment with strategic priorities, not just “one-size-fits-all” reporting.
ESMA also highlights climate disclosures and coherence between financial and sustainability reports, with particular attention to EU Taxonomy alignment. The aim is clear: companies need to think about how they present a unified story across their financial and sustainability disclosures, showing how climate risks and opportunities are reflected in the business model and financial outcomes.
The message from ESMA is clear: get your house in order. Align sustainability and financial statements and be ready for heightened scrutiny from the regulator. We've been demystifying the regulation and supporting our clients in tackling double materiality, stakeholder engagement, and climate-related efforts—ensuring a seamless and (almost) enjoyable experience.
5. A sustainable secret santa
As the Halloween decorations come down, retailers are quick to urge us to start the Christmas shopping. And, like clockwork, the annual work Secret Santa email has probably already hit your inbox, sparking the usual dilemma of finding a gift for that hard-to-shop-for colleague. The pressure to buy things people might not need (or want) can feel a little un-festive—not to mention the toll it takes on the environment. So why not try something new this year and make Secret Santa less wasteful and more fun?
To provide you with some inspiration, Today Do This has released a practical 10-point guide for a sustainable Secret Santa this year. It’s full of clever tips for making gift exchanges thoughtful, memorable, and planet-friendly. Ideas include gifting only pre-loved or upcycled items, starting a book swap that turns into a year-round office library, organising a ‘reverse advent calendar’ to collect items for a local food bank, or donating to a charity in your recipient's name. The UK environmental charity Hubbub is also advocating for a “Second-Hand Santa” policy, encouraging companies to swap brand-new buys for pre-loved treasures.
At Good Business, we’ve embraced “handmade or preloved” Secret Santas for years, and the results have been fantastic. Some of the most cherished gifts include a retro Arsenal top from Oxfam, a handcrafted magnetic bottle opener, and a tin mug that’s become a desk staple.
This year, let’s make our gifts kinder to the planet and kinder on the wallet. Second-Hand Santa isn’t just a thoughtful gesture— it’s a small yet impactful step toward a more sustainable holiday season.
