India Inc is significantly increasing its sustainability investments and tackling climate change has become a high priority for business leaders, according to recent Deloitte and Infosys climate change surveys of top business leaders.

About 81% of Indian CxOs say they have increased their sustainability investments over the last year, with 27% saying investments have increased “significantly,” according to Deloitte’s 2023 CXO Sustainability Survey. This surge in investment could be attributed to the fact that 53% of Indian CXOs surveyed believe that climate change is likely to impact their companies’ strategies and operations to a “high/very high” degree over the next three years, the report notes.

Indian CxOs ranked “climate change” as a significantly higher priority than “economic prospects” compared to global executives, with 57% citing it as “the top three priorities,” compared to 42% of over 2,000 global CxOs who were ranked by Deloitte were surveyed in 24 countries.

A 10 percentage point increase in environmental, social and governance (ESG) spending correlates with a 1 percentage point increase in earnings growth, and most companies saw positive financial returns from their ESG efforts, according to a recent “ESG Radar: ESG Redefined: From”. Compliance to Value Creation’ report issued by Infosys after surveying 2,500 executives across industries in Australia-New Zealand, China, France, Germany, India, Scandinavia, North America and the UK.

Almost all (90%) executives from this global survey say their ESG spending has resulted in moderate or significant financial returns, and most respondents (66%) have achieved ESG returns within three years. A company that currently spends 5% of its budget on ESG can expect a 1 percentage point increase in profits if it adjusts its operating or capital budget to increase the proportion of ESG spending to 15%, according to the ESG report by Infosys.

“But budgeting for increasing climate change investments is likely to be a constraint for most companies in the current economic scenario and outlook, as companies need more financial resources and operating model changes to achieve ESG goals and sustain earnings growth,” said Mohammed Rafee Tarafdar, chief technology officer, Infosys said recently luck india, in analyzing Infosys’ ESG report.

According to the Deloitte report, 60% of Indian CXOs rated a “just transition” as extremely important to their organization’s sustainability efforts, compared to 46% of global leaders. A “just transition” aims to ensure that the significant benefits of transitioning to a green economy are widely shared, while supporting those who are economic losers – be they countries, regions, industries, communities, workers or consumers, Deloitte explains.