IN THE YEARS SINCE THE 2021 ROUND OF global climate negotiations, more than 2,600 companies have responded to alarms raised by scientists and policy makers by setting aggressive targets to reduce carbon emissions.¹ Walmart aims to become powered by 100% renewable energy by 2035; Ikea has made a commitment to produce as much renewable energy as it consumes by 2030; General Electric aims to transform itself into a net-zero company by 2050; and American Electric Power plans to reduce its carbon emissions 80% by 2030, with a goal of net-zero emissions by 2045.²
These sustainability goals address demands from a broad array of stakeholders that companies disclose material risks and improve their environmental and social impacts. They also serve to focus the attention and resources that are required within organizations to drive social and environmental progress on the ground.
However, setting appropriately ambitious sustainability goals that can pull a steady line of progress through today’s uncertain business landscape is an exceedingly difficult task. Economic volatility, evolving stakeholder demands, scientific and technological developments, and variable sociopolitical pressures mean that the ground is constantly shifting under leaders’ feet.
Activist stakeholders in particular are watching company performance on these issues closely, demanding corporate transparency around goals and progress, and faulting companies that fail to follow through on their pledges. A 2022 study published by the nonprofit organizations NewClimate Institute and Carbon Market Watch identified 25 large corporations with net-zero commitments and rated 21 of them as having “low integrity” or worse because their plans would reduce emissions by only 40% on average, not the 100% implied by net zero.
Denne historien er fra Winter 2024-utgaven av MIT Sloan Management Review.
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Denne historien er fra Winter 2024-utgaven av MIT Sloan Management Review.
Start din 7-dagers gratis prøveperiode på Magzter GOLD for å få tilgang til tusenvis av utvalgte premiumhistorier og 9000+ magasiner og aviser.
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Avoiding Harm in Technology Innovation
To capitalize on emerging technologies while mitigating unanticipated consequences, innovation managers need to establish a systematic review process.
Make a Stronger Business Case for Sustainability
When greener products and processes add costs, managers can shift other levers to maintain profitability.
How to Turn Professional Services Into Products
Product-based business models can help services firms achieve greater scale and profitability. But the transformation can be challenging.
Do You Really Need a Chief AI Officer?
The right answer depends on the strategic importance and maturity of AI in your company.
Where To Next? Opportunity on the Edge
Doing business in regions considered less stable or developed can pay off for companies. But they must invest in working with local communities.
Make Smarter Investments in Resilient Supply Chains
Many companies invest in resilience only after a disruption. Applying the concept of real options can help decision makers fortify supply chain capabilities no matter the crisis.
The Three Traps That Stymie Reinvention
Organizational identity, architecture, and collaboration can be either assets or liabilities to pursuing growth in new sectors.
What Makes Companies Do the Right Thing?
Vaccine makers varied widely in their engagement with global public health efforts to broaden access to COVID-19 immunizations. Ethically motivated leadership was a dominant factor.
Build the Right C-Suite Team for Your Strategy
CEOs can foster a more effective leadership team by understanding when to tap senior executives' competitive instincts and when to encourage collaboration.
A Better Way to Unlock Innovation and Drive Change
A strengths-based approach to building teams can win employee commitment to change and foster an inclusive, agile culture.
