Trends Driving Corporate Climate Strategies in 2024

Research firm Verdantix recently published a study surveying 353 global decision-makers, across 38 countries, on the key trends shaping their corporate climate change strategies in 2024.

Currently, net zero targets cover a majority (92%) of global GDP.

According to the study, prioritizing compliance, seeking competitive advantage, and aligning with stakeholder requirements are the top three factors driving firms’ decarbonization efforts and investments over the next year. 

The Verdantix study also reveals that although almost 10% of firms are not confident in their ability to reach short-term decarbonization, carbon management spend is still expected to increase by an average of 14% over the next two years, as companies invest in software that can help them meet looming emissions reduction benchmarks. 

Other key takeaways from the research include:

• Compliance as a cornerstone: Regulatory compliance is emerging as a cornerstone of climate strategy, ‌creating urgency around implementing climate strategies, and investing in software and services that will assist in taking action against emissions reduction goals. Recent regulations include the EU’s CSRD that was implemented in January of 2024, SB253 & SB261 that were passed in September of 2023, and the U.S. SEC Climate Disclosure ruling that passed in March.
• Industry and regional context: Priorities and challenges related to decarbonization vary based on industry and regional context. It is essential for companies to consider these factors when formulating their strategies and addressing decarbonization challenges specific to their sector.
• Targeting net-zero software capabilities: Spending on climate software and services has increased, with markets expected to grow at CAGRs of 20% and 29% respectively. Firms are increasingly targeting a mix of software solutions with carbon management capabilities like net-zero target-setting, pathways, and forecasting, project portfolio management, and mandatory climate reporting workflows, to support their progress towards decarbonization targets.

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