Throughout 2022, we saw the emergence of a number of ESG trends – from the rise of green jobs and ESG influencers, to the introduction of new ESG laws such as the Corporate Sustainability Reporting Directive. 

Not to mention COP27, which saw nations pledge to create a fund to aid countries facing severe damage from climate change, as well as the launch of important new African initiatives. 

So, now that 2023 is upon us, what can we expect to see in the ESG space this year?

Clamping down on greenwashing

The Financial Conduct Authority (FCA) recently issued new proposals aimed at clamping down on greenwashing, which forms part of the commitment made in its ESG Strategy and Business Plan to build trust and integrity in ESG-labelled products. 

The proposals include:

• A general anti-greenwashing rule applicable to all regulated firms 
• Three categories of sustainable investment product labels 
• Restrictions on how sustainability-related terms, such as “green” and “ESG” can be used in names and marketing for products which don’t qualify for the sustainable investment labels 
• Disclosures to help consumers understand key sustainability-related features of investment products
• Obligations on distributors of products to ensure that labels and disclosures are accessible and clear

The FCA is expected to publish its final rules by 30 June 2023, so in the latter half of the year we may begin to see firms preparing for these rules coming into place, which is expected to be between 2024 and 2026. 

Increased trust in ESG claims

Earlier this year, a report from Sensu Insight named ’50 Shades of Greenwashing’ revealed that more than four in 10 Brits are wary or dismissive of ‘green’ claims from firms. What’s more, almost one in three expect environmental claims from companies to be slightly exaggerated, while 14% don’t believe them at all. 

Among the companies least likely to be trusted were airlines, whereas those most likely to be believed included supermarkets and food and drink brands. 

With this in mind, we can expect to see firms prioritise their corporate social responsibility in 2023 with a particular focus on building consumer trust. And with many companies being legally obliged to publish their ESG results this year, data such as this can play a key part in educating consumers on sustainable initiatives and policies. 

Companies investing in ESG

At the start of 2023, Nestlé UK and Ireland demonstrated its ESG commitments by announcing an ESG investment, despite a “challenging and turbulent year”.

As part of this, the company unveiled a €1.25bn plan to support ethical cocoa growers, as well as a ‘wheat plan’ with Shreddies suppliers to promote regenerative agricultural practices. It also switched to low emission delivery vehicles to cut its carbon footprint and introduced 100% recyclable paper wrapping for its Quality Street chocolates. 

With huge companies like Nestlé starting to make public ESG commitments and pledges, we can expect to see other companies begin to follow suit in 2023. Whether this is through implementing renewable energy, increasing diversity across the board or paying the same percentage of salary in pension contributions to all workers, ESG investments are likely to be high on the agenda in 2023. 

What’s more, it’s important for companies to properly communicate these ESG investments so that stakeholders such as investors, consumers and staff understand their commitment.

Here at Liquid, we have a wealth of experience in helping our clients communicate their ESG credentials, so if you’re on this journey and looking for a Birmingham PR agency to support you, get in touch!