3 Reasons Why European Sustainability Momentum Matters for US Firms

A recent Reuters article reviewed findings that 90% of European business leaders plan to maintain or increase sustainability investments by 2026. As a boutique ESG consultancy group that has worked with numerous US multinational clients, we see several compelling reasons American firms must follow suit despite local ESG backlash.

1. Tightening regulations abroad directly impact global supply chains. The article notes that European scrutiny around carbon emissions and ESG disclosures intensifies. US companies exporting abroad face growing compliance burdens, risks of production delays, and reputational concerns overseas.

2. Sustainable branding is increasingly crucial for global consumer trust and loyalty. Europeans rank climate action and social responsibility high when making purchasing decisions. Lagging rivals in sustainability commitment hamper sales, talent attraction, and public perception across markets.

3. Transparency demands are going global. Initiatives like the International Sustainability Standards Board seek unified ESG reporting frameworks spanning jurisdictions. Activists, investors, and consumers are pressing all large firms for robust emissions accounting and auditing through the entire value chain.

In summary, the sustainability imperative transcends geography. Through rising stakeholder pressures and moral obligation, ESG acceleration reaches worldwide. US executives would be wise to plan accordingly.

To read the full article: https://www.reuters.com/sustainability/europe-business-leaders-spend-more-sustainability-by-2026-study-2023-11-15/