Greener Bottom Line Trends #3 – Preparing for CBAM, Moving Beyond Emissions Tunnel Vision at COP16, and Shifting from Compliance to Innovation

As the EU prepares to implement its Carbon Border Adjustment Mechanism (CBAM) in 2025, the urgency for leaders to value and accurately report their company’s carbon data has never been greater. ?

Leaders are moving beyond "emissions tunnel vision " and considering their broader environmental impact, as highlighted by the upcoming UN COP16 biodiversity conference . While reducing carbon emissions has been the primary focus of corporate sustainability, this narrow approach risks overlooking critical planetary boundaries like biodiversity loss and ecosystem degradation. ?

Looking ahead, corporate teams that prioritize data transparency and innovation across their value chains will gain a competitive advantage, as harnessing high-quality sustainability data becomes essential for sustained success.?

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Preparing for CBAM by Valuing Carbon Data?

Starting in 2025, importers must report the embedded emissions of certain goods to comply with the CBAM, with full enforcement and financial obligations beginning in 2026. As Devin O’Herron , Senior Sustainability Expert at Assent, highlights in Supply & Demand Chain Executive , “carbon data has a literal monetary value.” CBAM aims to prevent "carbon leakage" by taxing imported goods based on their emissions, aligning non-EU manufacturers with EU climate policies.?

Companies must now use primary emissions data from suppliers, setting new standards for supply chain transparency. This extends to scope 3 emissions, adding complexity for global supply chains. The financial stakes are significant—importers relying on default estimates may face higher costs, while suppliers risk losing business if they fail to provide accurate data. As CBAM reshapes supply chain practices, carbon transparency is becoming a key driver of competitive advantage in a sustainability-focused global market.?

Moving Beyond Emissions Tunnel Vision at COP16?

In 2017 research by The Nature Conservancy and 15 other institutions found that nature-based solutions, like restoring forests and wetlands, could reduce emissions by 11.3 billion tones per year (the equivalent of stopping burning oil globally) providing up to 37-percent of the global emissions reductions required by 2030 to keep global temperature increases under 2 degrees celsius. ?

Prior biodiversity research is on c-suite agendas as leaders look to make progress on their emission reduction goals. Several companies, including Microsoft and Schneider Electric , are integrating biodiversity into their strategies, recognizing that healthy ecosystems are essential for business sustainability. Tools like the Taskforce on Nature-related Financial Disclosures (TNFD) are helping firms track and mitigate their impacts on nature.?

Tom Idle , Founder of UK based corporate ESG storytelling strategy firm Narrative Matters writing in Sustainability Brands emphasized that as COP16 unfolds, the global focus will shift toward actionable plans that align corporate efforts with biodiversity protection . Companies that embrace these broader ecological goals will not only safeguard the environment but also ensure long-term success by addressing nature-related risks.?

Shifting Sustainability from Compliance to Innovation?

In an era of increasing regulations and shifting political narratives surrounding corporate sustainability, it’s essential to remember that resource waste equates to lost profits. The less your company consumes, the more you save. Simply put, sustainability is good business.?

A 2024 survey by IBM’s Institute for Business Value (IBV) and Oxford Economics, which included 5,000 C-suite executives from 22 countries, underscores this point. The findings reveal that 47% of executives struggle to secure funding for sustainability initiatives, while only 30% report making significant progress in implementing their strategies—up from just 10% the previous year. Additionally, companies are spending 43% more on sustainability reporting than on innovation. However, organizations that integrate sustainability into their operations see a 16% increase in revenue growth. Notably, 82% of executives highlighted the importance of high-quality data and transparency.?

The report suggests that generative AI may be a “game changer” for sustainability, with 64% of executives stating it will be crucial for their efforts, and 73% planning to boost investments in generative AI for sustainability.?

As Ted Kail , Chief Product Officer at Cority, emphasizes in Forbes , sustainability is not just a compliance issue; it’s a key component of long-term success.?

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