Part 2 — What Are We Doing Wrong?
Over the past decade, there has been significant momentum in the field of sustainability. However, this momentum has not always progressed at the same pace as real transformation on the ground.
Companies announce targets, institutions publish strategies, and the financial sector says that sustainable investments are increasing rapidly.
However, when we look at what is happening in practice, it is not always possible to observe transformation on the same scale yet.
This situation points to some structural problems in sustainability practices.
The points below summarize only a few of these structural problems.
Sustainability is large in communication, but small in budgets
Many organizations communicate their sustainability vision strongly. However, this vision often does not translate into core corporate decisions to the same extent.
In areas such as CAPEX decisions, supply chain choices, executive incentive systems, and risk appetite, sustainability is still not a decisive criterion. Targets often remain in strategy documents, without forming a real connection with financial decision-making.
Real transformation begins not in communication, but in budgeting and planning processes.
In recent years, there has been a significant increase in sustainability reporting. Companies publish comprehensive reports and allocate substantial resources to this process.
However, this increase does not always translate into operational practices. Impressive reports and visibility-focused communication can sometimes become a matter of prestige among institutions. Yet it is not always possible to observe the same depth of change in operational practices.
When sustainability begins to be measured more by what is written than by what is done, report production starts to take precedence over implementation.
Activities are reported, but real impact is not measured
Sustainability reports often describe the activities that have been carried out.
- How many training sessions were delivered?
- How many trees were planted?
- How many projects were launched?
However, it is not always clear what these activities actually change in the real world.
- Does a training program truly change decision-making processes?
- Does an emission reduction project significantly reduce total emissions?
- Does a social program create lasting impact on poverty or inequality?
If the answers to these questions are unclear, generating activity and creating real impact become intertwined.
The SDGs are one of the clearest examples of this situation. Over the past decade, numerous projects and programs have been carried out under the Sustainable Development Goals, and most of them have been reported. However, global indicators have not improved to the expected extent.
Producing activities is not the same as creating systemic impact.
Incentives often support scale rather than transformation
Financing and incentive mechanisms in sustainability are expanding rapidly. Public support schemes, green finance instruments, and various funds are being discussed more and more.
However, a significant share of these resources is directed toward companies that are already large and strong. Access to this financing often remains limited for SMEs.
Yet, a large part of the economy consists of SMEs. When transformation progresses only through large companies, it becomes much more difficult to create the expected impact across the system as a whole.