A growing number of Irish businesses are committing to sustainability, according to the latest EY Ireland’s State of Sustainability report.
Eight in ten respondents reported an increased focus on sustainability in the past year, a 19% increase from the last survey in 2022.
This is the largest percentage increase noted in the study, indicating that Irish businesses are now making a significant commitment.
However, concern among business leaders around accusations about greenwashing has tripled, with 35% of those surveyed saying it affects their communication strategies, up from 13% two years ago.
The report surveyed 200 senior sustainability decision-makers across the public and private sector in Ireland.
Its findings suggest progress is being made by Irish businesses when it comes to sustainability.
According to the report, nearly three quarters of respondents rate their efforts on sustainability as ‘established or better’, a rise from 61% in 2022, and 15% consider their efforts ‘industry leading’, doubling from 7% in 2022.
35% of respondents, however, feel their organisation is not doing enough, a notable rise from 17% in 2022, showing that there is still more to do.
“It is very encouraging to see a shift amongst Irish businesses towards a better understanding of sustainability, its impact on the bottom line, and a real desire to create a more sustainable business approach across all sectors,” Derarca Dennis, EY Ireland Partner and Sustainability Services Lead said.
Ms Dennis said the findings show the link between sustainability and profitability is increasingly influencing the corporate strategies of Irish organisations, including how they approach mergers and acquisitions.
She added that as companies embrace this agenda, it’s vital they engage with all stakeholders to create a more resilient and sustainable business.
The study found the key motivating factors driving sustainability in organisations include increased stakeholder interest, regulations and perceived bottom line benefits.
More than half believe demonstrating a greater commitment to sustainability is necessary for them to get access to capital, according to the findings.
Three in 10 businesses assess the sustainability status of target companies when considering a merger or acquisition.
In terms of sustainable supply chains and the growing demands of regulators, investors and consumers, Ms Dennis warns that organisations that have not yet started engaging and collaborating with their supply chains run the risk of being left behind.