Do you know that the World Economic Forum in its 15th Global Risks Report 2020 found, for the first time in the report’s history, that all of the “top long-term risks by likelihood” are environmental?
Do you know that the EU desires to become the first climate-neutral continent by 2050 and, to do that, we need between €175 to €290 billion in additional yearly investment from public and private funds in the next decades?
Do you know that, in order to achieve set goals and make the EU’s economy sustainable,the EU is adopting a new, more ambitious EU strategy through regulations imposing obligations across public and private sector?
- „Sustainability” - What does it mean?
- Where are we?
- Where are we going?
„Sustainability” - What does it mean?
Sustainability have at its core three pillars: environmental, social and economic governance.
Sustainability can be understood as a general idea of a world where all people can live productive, flourishing and peaceful lives on a healthy planet and this idea is materialized through global, national and regional strategies aiming towards economic growth based on social justice and the efficient use of natural resources.
From this general idea of sustainability, new policies having significant impact on business reality are being implemented on global, in particular United Nations' level, but also on European Union’s level and national levels, what leads, among other things, to new compliance obligations for entities conducting business activities. New regulations will support sustainable growth by obliging market players to adapt their businesses.
Sustainable development is the key to achieve sustainability. Sustainable development does not present a „magic recipe” solution to e.g. save the environment from deterioration, but it demands an essential for future prosperity change in humanity’s environmental, social and economic behaviour.
Where are we?
The issue of sustainable business is dynamically gaining in significance worldwide, in Europe and in Poland. Sustainability, as a global challenge, requires a global response in all sectors.
The EU has committed itself and, therefore, its member states, to meet the relevant targets set under, among others, the UN Sustainable Development Goals (SDGs), the 2030 Agenda for Sustainable Development having at its core the Sustainable Development Goals (SDGs) and the Paris Agreement adopted under the UN Framework Convention on Climate Change.
In December 2019, the European Commission presented the European Green Deal – a roadmap with actions for coming years to make the EU’s economy sustainable in order to turn challenges into opportunities by transforming EU’s economic model. However, meeting the objectives of the European Green Deal will require major investments from both the public and the private sector and the change in the approach to business.
At the EU level, regulatory measures have been intensified, resulting in the adoption of a number of legal acts introducing new obligations in the field of sustainable development.
Where are we going?
We are moving towards a comprehensive reform of the regulatory framework. Requirements concerning ESG are becoming no longer “nice-to-haves”, but rather compliance obligations for investors.
The overriding objectives will be dynamically addressed through real-economy policy across all sectors and levels.
The EU’s transition to sustainable economy is considered as vital to ensure its long-term competitiveness, and the EU’s long-term plan includes introducing regulations to channel private capital to be directed into green and sustainable investments.
The regulatory environment concerning sustainability is still in its formation, but its dynamic growth can be expected in the coming years. The above regulations will both directly and indirectly affect the day-to-day operations of entrepreneurs, including entrepreneurs in Poland, and will particularly affect the financial sector (sustainable financing) and the real estate sector (sustainable investments).
In our upcoming series of publications „Green (R)evolution for Business”, we present a topic of sustainability from the legal and market perspective, mainly real estate one since the real estate market finds itself in the centre of legal, economic and social transformation.
The strategy of moving forward and the proactive actions will determine future compliance with regulations.
It is worthwhile to orient the company's activities towards sustainable development as we will soon live in a world in which sustainable investments are a new daily reality.
In this series of publications we navigate through topics related to sustainability as we believe that they are the basis for functioning in the world of tomorrow, not only business one. We will focus on practical aspects for business as we strongly believe that this multidimensional initiative of sustainable development takes on extremely practical and beneficial dimensions, including but not limited to better rates of return on invested capital or higher corporate income.
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