*by Kiara Konti
Without a doubt, Europe is currently leading global efforts to address climate change. With the European “Green Deal,” the European Commission has set the ambitious goal for the European Union to become climate-neutral by 2050 through new legislative initiatives for the circular economy, building renovation, biodiversity, agriculture, and innovation. Additionally, with the “Fit for 55” package, the aim is to reduce greenhouse gas emissions by 55% by 2030, with further interventions in transportation, heating, and renewable energy sources.
In the sphere of European business, a significant step towards these goals is the CSRD Directive on sustainability reporting, which modernizes and strengthens rules regarding information on social and environmental issues and governance that companies must disclose.
Similarly, in Greece, the National Energy and Climate Plan (NECP) has already since 2019 outlined a roadmap for achieving ambitious energy and climate goals by 2030.
The performance of our country is improving in many areas, with the contribution of renewable energy sources to electricity production, for example, reaching 43% in Greece in 2022, compared to 41% in the EU, according to Eurostat data.
Moreover, according to the latest edition of the EY Renewable Energy Country Attractiveness Index (RECAI 62), which evaluates the top 40 economies in terms of attractiveness of investment opportunities in renewable energy sources, Greece ranked in the top three of the adjusted index, which assesses countries’ performance adjusted according to their GDP.
However, beyond governmental and regional policies for climate change and sustainable development, in practice, it is the businesses that are called upon to take the most critical initiatives, drastically changing their operations and investing in innovation to improve their environmental footprint.
While the performance of Greek businesses, though encouraging, is subject to improvement. According to the EY Sustainable Value Study Greece 2023, 96% of businesses in our country participating in the survey have undertaken some public commitment to address climate change. However, only 44% have made specific commitments by 2030.
The research categorized the performance of businesses into three groups based on their actions for climate change: pioneers, explorers, and observers.
Only 9% of Greek businesses were classified as “pioneers,” having completed most climate actions, compared to 32% globally. Similarly, “observers,” companies that still have a distance to cover, represented 39% of businesses in Greece, compared to 23% globally.
For many years, there was a prevailing belief that businesses’ actions for climate and investments in sustainable development had a negative impact on their financial performance. The experience of recent years refutes this perception. Businesses that adopt a comprehensive and ambitious approach to climate not only contribute to saving the planet but also create financial value for themselves. At EY, we call this value-led sustainability, sustainable development resulting from policies aimed at creating broader value. Therefore, we have seen that 45% of businesses in Greece participating in the research, and 69% globally, report that they have derived higher financial value from their climate initiatives than expected. Furthermore, pioneers, businesses that start their journey towards sustainable development earlier, secure even greater benefits.
In the same spirit, 72% of businesses participating in the EY Long-Term Value and Corporate Governance Survey Greece 2023 estimate that their investments in implementing ESG strategy have a positive economic impact, while 92% intend to increase these investments in the coming year.
However, globally, today, in an environment of economic slowdown and high inflation, we see many governments in Europe and elsewhere retracting from their commitments to reduce emissions due to their high short-term costs.
A retreat today could have disastrous consequences for the planet tomorrow. Climate change affects us all. It is not an indefinite threat that can be deferred to the future but a real problem of today that requires immediate mobilization from all of us—governments, businesses, and each and every one of us individually. In this challenge, although Greece’s vulnerability to natural climate risks is expected to increase, the country can simultaneously leverage its unique climatic characteristics for solar and wind energy production as a comparative advantage and lead the European and global effort towards a sustainable tomorrow.
Retreived from: esgstories.gr
