And the sustainability word in 2023 is....

In our final balance of the year we asked the Forética team what they believe has been the word of 2023 in sustainability, taking into account their knowledge and interaction with our more than 200 partners and presence in national, European or global reference groups or in the most relevant forums during the year. In the conversation, several candidates emerged as proof of the speed and the various advances made throughout the year.

At first, the word "interoperability" was proposed by our governance team, echoing the progress made this year (and in the coming years) in ESG reporting and the challenges of its digestion, coexistence and compatibility with current market practices. This year we have spent a lot of time at Forética anticipating the impact from January 2024 on the content of acronyms that are already becoming very familiar, such as the CSRD sustainability reporting directive and the ESRS standards (NEIS) in Europe, or in other jurisdictions the IFRS S1 and IFRS S2 standards (USA, Brazil or UK, for example). In a document from the Forética Transparency Cluster, we already mentioned that: "the ESRS project takes into account existing European and international legislation and initiatives on sustainability, facilitating interoperability with various standards, such as ISSB, TCFD and GRI, to avoid fragmentation and duplication of efforts in terms of disclosure".

Another term that has resonated a lot in the different meetings and especially at the end of the year in the wake of the COP 28 in Dubai, as our climate team showed us in the summary for companies of the Climate Change Cluster, has been both the term "phase out" (finally not included in the text of the agreement) and the final proposal included the term "transition away" ("transition away from fossil fuels in energy systems, in a fair, orderly and equitable way, accelerating action in this critical decade, in order to reach the goal of zero net emissions by 2050, according to science").

Agreements that include "tripling global renewable energy capacity" and "doubling energy efficiency" by 2030 show that the journey to net-zero is accelerating (we see this clearly in the targets of our partner companies, their acceleration of transition plans, or disclosure of associated financial risks, among others), although the science calls for it to be at a faster pace, also coming out of a 2023 already crowned as the hottest year in recent history.

Of course, Forética' s social team defended the term "due diligence" in the face of the preparatory work of many of our partners in the face of the new directive planned for 2024 in this area(the CSDDD if we want more acronyms). The communication team also mentioned the impact of the upcoming directive on "greenwashing (eco-laundering) and Forética's technology group opted for "RAI" (Responsible Artificial Intelligence) and its link with ESG aspects in line with the launch of the project that we will be talking a lot about in 2024 "AI ON ESG".

Finally, the proposal of the word (or concept) "Nature-positive" was the one that ended up generating the most consensus in the team (we assume that it is also in English and the translation would be almost a phrase). But what is really important is how the interaction of the twin crises (climate and nature) and the need to accelerate solutions is manifested in the international conventions. COP 15 in Montreal in December 2022 with the global biodiversity framework and its objective to protect 30% of land and water by 2030 and COP 28 in Dubai recognizing the need and contribution of nature to maintain the temperature increase limit of 1.5 set by science have been fundamental.

This year in Forética we have seen that from a sustainability perspective, for many companies it is time for nature and we have worked very decisively with companies that have raised the relevance of their impacts, risks and dependence on nature, incorporating more ambitious plans in leading companies in recent months and strengthening international alliances with the main organizations in the field.

Probably in a few weeks we will see the WEF's global risks report headed by climate and nature, and recalling that, in addition to an ethical commitment and a business imperative, more than half of global GDP is highly or moderately dependent on intact ecosystems and their benefits.

Therefore, Nature-positive (stop and reverse the loss of nature) is the 2023 word in sustainability for companies. What has been yours? Happy 2024!