Sustainable Industry

Survey shows that 91% of medium and large industrial corporations manage their waste and use water and energy efficiently

The survey also showed that 98% of corporations have at least one sustainability action in place and 63% of them intend to invest more in this domain over the next 2 years

Amid preparations for the 26th Climate Conference (COP 26), the National Confederation of Industry (CNI) conducted a survey with the FSB Institute to investigate the viewpoints of Brazilian entrepreneurs and the concrete actions they have taken in relation to sustainability. In some aspects, the data show that they are at an advanced stage. According to the study – with executives from 500 medium and large industrial companies –, waste management practices and actions to reduce water and energy waste are now in place at nine out of every 10 companies surveyed. Nearly all companies (98%) engage in at least one of the eight sustainability practices listed in the questionnaire. The greatest concern of respondents was related to the disposal of waste. One in four respondents stated that this is their primary or secondary point of concern.

Even with an ongoing pandemic, in the midst of the economic crisis, 28% of them said they had expanded this type of investment over the last 18 months.

“The industrial sector has always been a relevant player and, in many moments, led the process of debunking the false dichotomy between development and preservation, man and nature. Historically, our sector has made a relevant contribution by developing solutions that boost the efficiency of production lines and promote the responsible consumption of resources. The survey data reveal that this is a widespread and ongoing concern throughout the industrial sector,” said president of CNI Robson Braga de Andrade.

Reputation with consumers and regulatory requirements leverage the sustainable agenda

Even with these obstacles, 40% of industrial companies have a sustainability strategy and agenda endorsed by the senior management. In large industries, the indicator goes up six percentage points and reaches 46%. Leaders in the industrial sector recognize the government’s role in encouraging and catalyzing the adoption of sustainable actions in the private sector. In the opinion of 71% of respondents, the State must control and stimulate companies to follow environmentally sustainable rules.

Requirements across the production chain reinforce sustainability actions in the corporate world

The survey showed that the majority of medium and large Brazilian industrial companies (52%) has had to provide a certificate of environmental compliance or take some sustainable action as a requirement to be approved as a supplier. However, this relationship policy is not yet widely used. Only one in three companies in the survey replicate the same requirements for their suppliers. Despite not imposing this condition on the production chain itself, the vast majority of executives (84%) believe that sustainability requirements have some weight for customers and consumers. For 24% of respondents, this weight is significant or very significant.

When it comes to adopting sustainable practices, solid waste management appears as one of the two priorities for 42% of respondents. Actions to avoid wasting water appear in second place with 38% of responses, followed closely by the use of renewable energy sources, with 36%. In fourth place are initiatives to avoid wasting energy (32%).

The industrial sector can raise further awareness of and step up actions related to sustainability

Despite the positive indicators, 72% of the surveyed executives admit that they have little or no familiarity with the acronym ESG (which refers to sustainability actions based on the environmental, social and governance pillars). Even with little or no knowledge of the issue, 81% of business leaders said that ESG is important or very important. Of the three pillars, governance is considered as the more relevant by them, with 39% of the responses, against 29% by those who mentioned the social (23%) and the environmental pillars.

The majority of executives from medium and large companies (55%) believe that the companies themselves are at a more advanced stage or on the same stage as the global industrial sector as far as sustainability is concerned, and 42% of entrepreneurs admit that the company they lead is lagging behind. In terms of an organizational structure, only 34% of companies have a formally designated division to deal with sustainability. Of these, just over half of these divisions have a budget of their own. Another point of concern is related to sustainability goals – only one in three companies in the study claims to have them in place.

The Instituto FSB Pesquisa interviewed executives from 500 medium and large industrial companies by telephone, and gathered a proportional sample vis-à-vis the total number of industrial companies of similar size in all Brazilian states. Within the individual regions, the sample was stratified by size (medium and large companies) and business segment. The interviews were conducted on October 13-22, 2021. Due to rounding, the sum of the percentages can vary from 99% to 101%.