As climate, capital, and intelligent technology reshape the conditions of enterprise, sustainability has moved from the edge of the corporate agenda to the centre of how serious companies build value, manage risk, and earn lasting trust.
By
Dr. Swapnil Sahoo – Assistant Professor, Strategy & Entrepreneurship,
Great Lakes Institute of Management, Gurgaon
For a long time, sustainability was treated as a good deed at the edge of business. It appeared in CSR brochures, tree-planting photographs, and the closing pages of annual reports. That era is ending. Sustainability is now entering the heart of strategy, not because it has become fashionable, but because the risks it addresses have entered the heart of business itself. Climate volatility, water stress, fragile supply chains, inequality, and the rapid rise of artificial intelligence are no longer distant concerns. They are boardroom issues. The World Meteorological Organization has confirmed that 2015 to 2025 were the warmest eleven years on record. That is not merely environmental data; it is business data. It shapes agriculture, logistics, insurance, energy, public health, and what customers choose to buy. No company can grow responsibly while ignoring the conditions that make growth possible. The shift in thinking is now measurable at the very top. The 2025 CEO Study by the UN Global Compact and Accenture, drawing on nearly 2,000 chief executives across 128 countries, found that 88 percent of CEOs believe the business case for sustainability is stronger than it was five years ago, and that 99 percent intend to maintain or expand their commitments. Among leaders, the debate is no longer whether sustainability matters. It is how to act on it credibly, while absorbing a wave of technological change that is itself reshaping the sustainability equation.
That technology is artificial intelligence, and it sits at the centre of the story in two opposing ways. Used well, AI is among the most powerful sustainability tools a company now has. It can sharpen energy management, predict equipment failure before it wastes power, optimise logistics to cut fuel and emissions, monitor supply chains for environmental and labour risk, and make ESG reporting faster and more accurate than manual methods ever allowed. Bain & Company’s 2025 research found that more than half of consumers using generative AI tools rely on them to live more sustainably, and about a third use them for eco-friendly product recommendations. Yet AI is not automatically sustainable, and here the same technology becomes a liability. The International Energy Agency estimates that data centres consumed around 415 terawatt-hours of electricity in 2024, roughly 1.5 percent of global demand, and projects this could more than double to about 945 terawatt-hours by 2030, an amount comparable to Japan’s entire annual consumption. The electricity use of AI-focused servers is growing by about 30 percent a year. A company that deploys AI to reduce its footprint while ignoring the footprint of the AI itself has solved nothing. Digital transformation, to be credible, must also become energy-aware transformation. This is the first hard test of whether a firm’s sustainability strategy is real or rhetorical. 
The wider pressure is arriving from every direction. Investors want evidence that companies understand long-term risk. Regulators demand clearer disclosure. Consumers ask whether brands respect people and the planet. In India, the change is visible. The top 1,000 listed companies by market capitalisation must disclose their environmental, social, and governance performance through Business Responsibility and Sustainability Reporting, mandatory since 2022–23. The stricter BRSR Core, requiring reasonable assurance on key metrics, is being phased in from the top 150 companies toward all 1,000 by 2026–27. Globally, the new IFRS S1 standard, effective for reporting periods beginning on or after 1 January 2024, requires firms to disclose sustainability-related risks that could affect cash flows, access to finance, or cost of capital. The message across markets is consistent: sustainability is becoming a question of capital, not merely reputation.
The data confirms how far this has travelled. KPMG’s 2024 survey of 5,800 companies found that 80 percent now publish carbon-reduction targets and 79 percent conduct some form of materiality assessment. CDP reported that more than 22,100 companies disclosed environmental data in 2025, together representing more than half of global market capitalisation. Transparency is becoming part of competitiveness itself. Governance is the discipline that holds all of this together. Without governance, sustainability becomes sentiment, and AI becomes power without accountability. Boards must now ask sharper questions. Who owns sustainability inside the organisation? Who approves the AI tools it deploys, and on what data are they trained? Are climate, social, and AI-related risks part of enterprise risk management? Are executive incentives aligned with long-term value? And is the company prepared to refuse profitable but irresponsible growth?
Approached this way, responsible growth strengthens resilience rather than constraining it. A company that reduces its energy intensity is less exposed to volatile prices. One that maps its water risk is better prepared for drought and regulation. One that audits its algorithms lowers the chance of discrimination and litigation. And one that treats its communities with respect earns something no advertisement can buy: trust. The Indian market is moving the same way, faster than many assume. Bain & Company found that about 82 percent of consumers in India say they have started shopping more sustainably in the last five years, and nearly 80 percent are deeply concerned about climate change. Globally, PwC’s 2024 Voice of the Consumer Survey, covering more than 20,000 people across 31 countries, found that 80 percent are willing to pay more for sustainably produced goods, at an average premium of 9.7 percent. This does not mean buyers will accept vague claims. It means they expect affordability, quality, and responsibility to arrive together. A warning is warranted. ESG language can turn cosmetic, and AI language even more so. A glossy report cannot offset poor labour practices. A net-zero pledge means little without a credible transition plan. An algorithm trained on biased data can scale harm faster than any human process. The years ahead will be unkind to both greenwashing and its newer cousin, AI-washing. Responsible growth is not anti-growth. It is growth that can be defended morally, sustained economically, and trusted socially. For business leaders, the real question is no longer whether sustainability is desirable. It is whether strategy without sustainability, and technology without responsibility, can still honestly be called strategy at all.
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Sources Consulted:
World Meteorological Organization, State of the Global Climate (2025); UN Global Compact and Accenture, CEO Study (2025); International Energy Agency, Energy and AI (2025); Bain & Company, Consumer Lab ESG research and “Sustainability Is a Natural Part of India’s Consumer Journey” (2024–2025); Securities and Exchange Board of India, BRSR framework and BRSR Core (2021–2024); IFRS Foundation / International Sustainability Standards Board, IFRS S1 (effective January 2024); KPMG, The Move to Mandatory Reporting: Survey of Sustainability Reporting (2024); CDP, Disclosure Data Factsheet (2025); PwC, 2024 Voice of the Consumer Survey.
