By Business & Finance 
There are numerous ESG trends and challenges to look out for in 2025. From increased reporting standards to advancements in technology, here is what to expect as the year progresses.
An increased focus on climate action and climate justice
January 2025 has already seen cases of extreme weather. At time of writing, there are ongoing wildfires occurring across the US state of California that have resulted in casualties, severe power outages and a mass loss of property. According to experts, the likelihood of severe weather events has increased significantly in recent decades due to climate change.
Those most impacted by climate change are those who already find themselves marginalised. As such, climate justice advocates are demanding that businesses and governments focus on equitable solutions to climate change.
Advancements in technology
The role that technology plays in ESG reporting will continue to develop in 2025. Investment in clean energy solutions increased across 2024, with many organisations adopting sustainable technology that impacts ESG performance.
Many companies have incorporated AI into their daily operations. The increased demand for AI has put a strain on computational power, and has led to the development of more data centres.
AI complicates the journey towards sustainability, as chatbots like ChatGPT use far more power than other internet uses such as search engine queries. According to a report by Goldman Sachs, a ChatGPT query requires approximately 10 times as much electricity as a Google search query.
A challenge for businesses moving into 2025 will be finding ways to embrace technology without sacrificing sustainability goals.
Increased ESG reporting standards
2024 saw increases in ESG reporting standards, with firms now mandated to disclose their ESG development and journey.
Reports are due to start appearing across the EU from some of the largest companies in early 2025.
Research by KPMG has found that only 29 per cent of companies worldwide have ESG policies systems in place in advance of independent ESG data assurance. This is despite looming deadlines.
Ireland is better poised to deal with ESG reporting requirements, with 60 per cent of Irish CEOs stating confidence in their organisations’ ability to meet targets, according to the KPMG CEO Outlook 2024.
Think your organisation is leading the way in sustainability? Don’t miss the chance to gain recognition for your ESG achievements. Enter the Business & Finance ESG Awards by 24th January, enter here: https://businessandfinanceesgawards.com/enter-now/
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