Strategies to Attract and Retain Sustainability Experts:Green Talent Shortage

In an era defined by pressing environmental concerns and rapid global transformations, businesses are navigating a critical crossroads. From the competition for green talent to scaling sustainability initiatives as tools to drive customer value, experts at IMD outline the pivotal trends shaping corporate priorities over the next 12 months.

As the sustainability landscape evolves, 2025 is emerging as a defining year for organizations grappling with both challenges and opportunities. With milestones like the UN Biodiversity Conference (COP16) in Cali and the UN Climate Change Conference (COP29) in Baku, the urgency for transformative action has never been greater. Concurrently, shifting political landscapes, including the aftermath of recent U.S. elections, hint at changes in global climate leadership, underscoring the need for businesses to stay ahead of emerging sustainability trends.

The Regulatory Transformation of Corporate Responsibility

Regulatory shifts are set to redefine corporate responsibility, introducing mandates for science-based transition plans and detailed accountability frameworks. These regulations demand that businesses not only set ambitious sustainability goals but also articulate precise, actionable roadmaps to achieve them.

With frameworks such as the Corporate Sustainability Reporting Directive (CSRD) and the International Financial Reporting Standards (IFRS) for sustainability risks, companies must align their operations with long-term climate mitigation objectives. This regulatory wave signifies a new era where detailed transition plans become the cornerstone of corporate climate accountability, connecting emission reduction targets to global efforts to limit warming to 1.5°C.

Scaling Impactful Sustainability Initiatives

The sustainability agenda is shifting from isolated experiments to scaling transformative initiatives. Companies like Siemens and Decathlon are pioneering efforts in circular business models and biodiversity-positive strategies, demonstrating how scaling sustainability aligns profitability with environmental stewardship.

As leaders transition from pilot programs to company-wide execution, the focus is on embedding sustainability across entire portfolios. This approach, emphasized by McKinsey & Company’s research, showcases the necessity of scalable solutions for future competitiveness. By addressing financial, operational, and regulatory challenges, these initiatives set the stage for broader adoption across industries.

The Evolution of Corporate Reporting

Corporate reporting is undergoing a paradigm shift, moving beyond traditional financial metrics to include comprehensive sustainability disclosures. With the introduction of mandatory transition plans under directives like the CSRD, companies must now address fundamental questions:

• How does the company plan to reduce its Scope 1-3 carbon footprint?
• What technological and operational changes are being implemented?
• How are resources being allocated to support these transitions?

These new reporting standards not only enhance transparency but also hold businesses accountable for their contributions to global climate goals. As reporting evolves, it’s expected that future requirements will extend to areas like zero freshwater usage, zero waste, and zero plastic usage.

The Persistent Role of ESG Amid Challenges

While environmental, social, and governance (ESG) initiatives face criticism and political pushback in regions like the U.S., their importance remains undiminished. Businesses continue to innovate in renewable energy, waste reduction, and circular economy practices, driven by consumer demand and climate change risks.

Even as regional challenges emerge—such as potential U.S. withdrawal from international climate agreements—corporations persist in aligning with ESG principles to manage risks, enhance market competitiveness, and address greenwashing concerns. Globally, countries like China are advancing ESG disclosures under ambitious carbon reduction goals, underscoring the continued relevance of sustainability in corporate strategy.

Family Offices Driving Purposeful Investing

Family offices are transitioning from wealth preservation to purposeful investing, emphasizing measurable societal and environmental contributions. Impact investments, distinct from traditional ESG strategies, prioritize outcomes in areas like biodiversity, climate solutions, and inequality.

With frameworks like the Global Impact Investing Network (GIIN) guiding measurement, family offices are increasingly aligning portfolios with long-term global impact. This evolution reflects a broader trend where next-generation leaders prioritize systemic change and sustainability, harnessing wealth to create legacies that transcend financial gains.

Holistic Risk Assessments

Businesses are expanding their approach to risk management, moving beyond financial implications to evaluate interconnected risks across systems. Climate change impacts not only environmental factors like natural disasters but also social dimensions such as food and water security, migration, and geopolitical instability.

Tools like KPMG’s dynamic risk assessment capture these complexities, enabling companies to future-proof operations. By considering distant stakeholders, past injustices, and overlooked risks, businesses can address sustainability challenges more comprehensively.

Integrating Climate and Biodiversity Agendas

The interconnection between climate change and biodiversity is becoming increasingly evident. The Rio Trio Initiative, launched at international environmental conferences, aims to coordinate efforts across climate, biodiversity, and desertification agendas.

With COP30 in Brazil poised to spotlight biodiversity, companies must broaden their strategies to include nature-positive approaches alongside carbon neutrality. Science-based targets for nature, currently adopted by over 150 companies, represent a growing emphasis on integrating biodiversity into corporate sustainability strategies.

The Growing Demand for Green Talent

The competition for green talent is intensifying as businesses seek employees with specialized skills in pollution prevention, renewable energy, sustainable finance, and more. Demand for green talent in Europe has grown by 5% annually, with countries like the UK, Norway, and Switzerland leading the charge.

Despite this growth, a talent supply gap persists, with projections indicating a shortfall of 18.7% by 2030. To bridge this gap, companies are investing in training programs and integrating sustainability roles into traditional functions like finance and procurement. Purpose-driven work is increasingly seen as a key factor in attracting and retaining top talent, particularly among younger, environmentally conscious professionals.

Converging Talent Development and Sustainability

Talent development and sustainability are converging as organizations recognize the importance of aligning employee growth with broader environmental goals. The Inner Development Goals (IDGs), emphasizing dimensions like being, thinking, and collaborating, are becoming integral to fostering systemic change. Companies like IKEA are leveraging these frameworks to enhance leadership capabilities and drive transformational progress. This trend reflects a shift toward prioritizing human skills and purpose-driven work in the age of AI and complex global challenges.

The Rise of Impact Secondaries

A new trend in impact investing, ‘impact secondaries,’ is reshaping early-stage exit dynamics. Specialized funds like Renewal Funds’ Secondary Impact Fund enable early investors in social enterprises to exit while preserving the company’s mission.

By addressing the mismatch between patient capital needs and investor liquidity preferences, impact secondaries unlock additional capital for the sector. This innovation offers a viable middle path for founders and investors, ensuring sustained social and environmental contributions.

Fostering Employee Well-Being

The integration of well-being into corporate culture is becoming a cornerstone of sustainable business practices. Companies are shifting from competitive, dominance-driven models to collaborative, purpose-driven approaches that emphasize emotional security and exploration. Secure base leadership, which combines resilience with a sense of purpose, is gaining traction.

Organizations are embedding stress management, mindfulness, and adaptability into daily practices, balancing technological advancements with a renewed focus on humanity. By fostering well-being, businesses can accelerate sustainability transitions while cultivating a thriving workforce.

Collaborative Solutions for Sustainable Development

Addressing complex societal challenges requires collaborative efforts that bring together corporations, social enterprises, governments, and communities. Partnerships that combine corporate scale with entrepreneurial agility and local knowledge are proving effective in creating scalable, context-appropriate solutions.

For example, initiatives like SAP’s partnerships with social entrepreneurs demonstrate the transformative potential of these coalitions. By aligning global capabilities with local wisdom, such collaborations can drive sustainable development and generate lasting impact.

The Political Dimension of Social Entrepreneurship

Social enterprises are increasingly adopting political roles to address systemic socio-environmental challenges. By influencing public policy and advocating for legislative reforms, these organizations are tackling structural issues at their root.

For instance, Too Good To Go’s efforts to mandate food waste reporting in the UK exemplify how social enterprises leverage political capital for broader societal change. This trend highlights the growing importance of multi-objective organizing, where social ventures pursue diverse outcomes, including policy advocacy, to address complex global crises.

Conclusion

As businesses navigate the evolving sustainability landscape, the trends shaping 2025 underscore the necessity of proactive, integrated approaches. From redefining corporate reporting and scaling impactful solutions to fostering green talent and aligning organizational growth with sustainability goals, these trends reflect a broader shift toward purpose-driven strategies. By embracing these transformations, companies can not only address pressing environmental and social challenges but also position themselves for long-term success in an era of rapid change and complexity.

Stay tuned for more news…