What Are CFOs Saying About Climate Action Amid Geopolitical Uncertainty?
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For months, headlines have been dominated by companies walking back or delaying climate commitments. Rising costs, geopolitical tensions, and economic uncertainty have fueled concerns that corporate sustainability efforts might be losing momentum. However, a new survey of 500 CFOs tells a different story:Far from backing down, financial leaders are doubling down on climate action and sustainibilityrecognizing it as a necessary investment in both long-term profitability and business resilience.500 Chief Financial Officers (CFOs) from the US, UK, UAE, and India participated in the studyGetty ImagesAccording to the report Staying the course: Chief financial officers and the green transition, released on February 17, 2025, a strong majority of CFOs remain committed to increasing climate investmentswith many expecting higher financial returns from green initiatives than from traditional investments. This suggests a fundamental change in corporate financial strategy. Sustainability is no longer viewed as a matter of corporate social responsibilityit is now a financial imperative driven by market opportunities, risk management, and evolving regulatory landscapes.This survey, conducted by We Dont Have Time and Kearney, gathered insights from CFOs across the United States, United Kingdom, the United Arab Emirates, and India. The data reveals a shift in corporate finance: sustainability is no longer viewed as a niche concern but as a core business strategy."The perspective of CFOs is often overlooked in the corporate sustainability debate, yet their role is crucial. As those in control of financial levers, CFOs are uniquely positioned to have a long-term impact on business strategy. And our study highlights that theyre already taking steps in this direction."Key Findings: CFOs See Sustainability as Profitable2024 CFO Study by Kearney and We Don't Have TimeImage from reportMORE FOR YOUBeth Bovis, Global Sustainability Lead at Kearney Press Image, Kearney93% recognize a clear business case for investing in sustainability, yet 61% still view these investments primarily as a cost rather than a value creatorsuggesting financial models still need to evolve.92% plan to increase sustainability investments in 2025, with more than half committing to significant increases.69% of CFOs expect higher returns on sustainability initiatives compared to traditional investmentsa clear sign that sustainability is increasingly seen as a financially sound business strategy.65% are already measuring the cost of inaction, particularly in the United States (75%), signaling increasing awareness of the risks of failing to act on climate.61% of CFOs see sustainability investment primarily as cost decision rather than as something that creates valueThe Financial Shift: Why CFOs Are Investing More in SustainabilityHistorically, sustainability efforts have been led by CEOs and Chief Sustainability Officers (CSOs), while CFOs focused on risk mitigation rather than proactively funding green initiatives. That is changing.The latest data signals a major shift in financial strategy. CFOs are increasingly viewing sustainability not as a regulatory burden, but as a growth catalyst. More than two-thirds now expect green investments to outperform traditional ones, reinforcing the idea that sustainability is a value driver, not just a compliance requirement.Additionally, rising regulatory risks, including new sustainability disclosure rules, are prompting CFOs to integrate climate-related financial planning into their broader business strategyensuring long-term resilience and profitability.One key takeaway from the report is that companies prioritizing sustainability are not just preparing for regulatory shiftsthey are actively positioning themselves as leaders in an evolving global economy.The Reality Check: A Gap in CFO PerspectivesHowever, the findings also expose a contradiction: 69% of CFOs expect strong financial returns from sustainability, but 61% still see it as primarily a cost. This indicates that while CFOs understand the potential for long-term financial gain, many still lack the right financial models to capture the true value of sustainability investments.This highlights a critical gap: Businesses must evolve financial evaluation models to account for the full impact of green investmentsincluding avoided costs, regulatory compliance benefits, and long-term brand value.Taking Immediate Action: CFOs Prioritize Practical Sustainability MeasuresInstead of waiting for 2050 net-zero goals, CFOs are prioritizing near-term, high-impact sustainability measures that generate measurable financial and environmental returns.The top investment priorities for 2025 include:Sustainable materials Reducing emissions by shifting to renewable and low-impact resources.Sustainable innovation & partnerships Investing in clean technology and collaborations that drive green solutions.Energy management & waste reduction Lowering costs through energy efficiency and resource optimization.Supply chain decarbonization Integrating sustainability into sourcing and logistics operations.This shift also reflects a broader trend in corporate strategywhere financial leaders are moving from passive climate commitments to active, data-driven decision-making that integrates sustainability into core business functions.Sustainability and Workforce Strategies: A Generational ShiftThe report also highlights how workforce expectations are influencing CFO decision-making. 71% of CFOs now consider sustainability in employee retirement fundsa clear response to employees demanding greener investment options. Moreover, 94% integrate sustainability into broader investment decisions, suggesting that ESG considerations are no longer a bonus but an essential factor in financial planning.This is a significant shift. As employees and investors push for more values-aligned financial strategies, CFOs are responding by embedding sustainability into core financial decision-making.As younger generations take on leadership roles, sustainability-driven financial decisions will likely become the standard rather than the exception.What Do the CFOs Answers Mean for the Green Transition?While corporate sustainability setbacks have made headlines, the latest data presents a more optimistic outlook. Financial decision-makers are not pulling back on green investments; instead, they are doubling down. The connection between sustainability and profitability is clearer than ever, with a majority of CFOs recognizing the financial advantages of green investments. Moreover, assessing the cost of inaction has become mainstream, as companies increasingly view failing to invest in sustainability as a greater financial risk than making the transition.A Joint Call to Action from CFOs and Financial InstitutionsWhile financial decision-makers are standing firm on green investments, the policy landscape must support them. CFOs are increasingly aligning investment strategies with climate goals, but they need regulatory consistency, clear sustainability reporting frameworks, and strong policy signals to ensure long-term success.This call for stability isnt just coming from CFOs. A coalition of over 200 investors, managing 6.6 trillion in assets, has recently urged the European Commission to protect its sustainable finance regulations amid discussions of potential rollbacks. These investors warn that weakening green finance rules would create uncertainty, slow capital flows toward climate solutions, and undermine Europes competitiveness in the net-zero economy.The message from both CFOs and major financial institutions is clear: The future of finance is green. Now is the time for businesses and policymakers to acceleratenot retreat fromclimate action.
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