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2025 was marked by a continued onslaught of turbulence and complexity reshaping the economy, business, and society. Indeed, the first few days of 2026 have already been shaped by unforeseen and consequential global events, and we should assume that this will continue. All of this means that even as the essential strategic value of sustainable business remains clear, the conditions for making progress are shifting in fundamental ways and facing many challenges, bringing the need to address new realities.
As the new year gets underway, we offer six questions that we believe will shape the year ahead.
1. With turbulence and profound change continuing in 2026, how can sustainability be seen as part of the answer rather than a distraction?
Business faces a challenging agenda in 2026. Disruptions arising from global trade arrangements, new technologies, political uncertainty, and other factors demand the attention of boards and C-suites. These developments have prompted many businesses to retreat to old thinking, asserting that sustainability is not tied to “real business” but rather a luxury. This has put many sustainable business leaders on the back foot, often with smaller budgets and less internal influence.
There should be no doubt, however, that sustainability, far from being a distraction, is in fact a fundamental part of the solution to these questions. Trade uncertainty means roiled supply chains; understanding the social and environmental dimensions of these changes is essential risk management. Similarly, the rise of AI demands attention to the energy/climate and labor market dilemmas posed by the continued growth of this technology. And as we note below, business has more to do to facilitate a more stable political system, without which a stable business environment cannot be assured. 2026 should be a year in which sustainable business leaders reassert their influence in helping to resolve these questions.
2. What new skills and perspectives will empower sustainability leaders, including CSOs, to regain momentum in the year ahead?
Sustainability leaders and teams will need to develop new skills and new networks to address the new operating environment.
The ability to effectively manage political and geopolitical risk is becoming more important. Sustainable business leaders should strengthen their understanding of political and geopolitical risks as they relate to sustainability and expand their networks of “stakeholders” to include people who bring this expertise. It is also time to address the persistent disconnect between sustainability and government affairs teams to strengthen companies’ ability to navigate a complex and uncertain global environment.
To state what is now clear, AI will likely become a hot button political issue, with salience well beyond what it is today. The Edelman Flash Trust Barometer, released late last year, showed high levels of public distrust of AI in the U.S., United Kingdom, and Germany (the report revealed higher levels of trust in China and Brazil). This portends a divisive political battle, particularly in the U.S. and Europe, over AI. Sustainability leaders inside companies—both developers and deployers—can help their companies appreciate the underlying reasons for this distrust. Failing to do so risks a political tsunami that will create even more uncertainty, interfere with innovation, and generate even greater levels of political division than exist today.
While we believe this is a time for sustainability leaders to develop new skills, networks, and expertise, it is also true that many core skills of sustainability leaders are uniquely suited for this moment: the ability to listen to diverse voices, a long-term orientation, and the ability to build bridges. The year ahead is time to reassert the value of these approaches and augment them with newly relevant features.
3. What is the new geography of sustainability leadership, and what are its implications?
For nearly the entire history of sustainable business, Europe and the U.S. have driven the agenda. That is no longer the case. Amidst confusion in Brussels and hostility in Washington, new centers of leadership are emerging. Brazil aims to build on its COP30 presidency to help design a pathway away from fossil fuels. China continues to steal a march on the West as the first electron economy. Singapore understands and is investing in an economy that enables human flourishing in its home country and region. In this context, the goal of convergent global standards and expectations can no longer be assumed—at least for now.
Global companies need to adapt. The “coalitions of the willing” that grew out of COP30 are far more likely to be the engines of progress than grand global agreements, and businesses should prepare to make the most of this model. Companies will need to shift from a compliance model to one that focuses first on strategic objectives. And companies, especially those from Europe and North America, should look to learn from and build on the advances being made in other parts of the world.
4. Political winds may again shift in the U.S. What impact, if any, would that have on sustainable business in the U.S. and globally?
Based on historical norms, political winds are likely to shift in the U.S. in November’s midterm elections. While no one would expect the White House point of view on sustainable business to change, businesses that have oriented many of their actions to the current administration’s policies may find traffic on the political street in the U.S. running two ways rather than one. This could usher in a period in which companies face competing expectations from different power centers in Washington and elsewhere in the U.S. on climate, inclusive business, human rights, and disclosure.
The lesson companies should take from the ever-shifting policy environment is that they should avoid overreacting to political developments: It does no company any good to be hit by the pendulum as it swings wildly back and forth. If workforces, communities, and consumers are growing more diverse, inclusive business is much more than symbolically valuable, it is a business imperative. If climate and nature risks create business risk, companies need to be resolute in prioritizing those issues, regardless of political views. If wild policy swings, regardless of direction, create business uncertainty, companies should seek to mitigate policy volatility. These approaches are all based on business needs, and therefore should be asserted no matter the winner of a particular election.
5. How should companies define climate leadership at a time when overshoot appears likely, energy demands are growing, and the COP process is weakening?
2025 did not deliver the progress on emissions reductions that the science tells us we need. The past year also delivered positive news: The steady growth of clean energy continues, with costs falling and availability growing faster than forecasts assumed. With 1.5°C slipping out of sight and energy demand continuing to grow, how should companies chart a path that meets the moment?
Three priorities are crucial as we go into 2026. First, companies should increase attention to clean electrification and continue to invest in other sources of clean energy. It is also time for business to focus more attention and effort on resilience, which has the benefit of addressing the needs of people and communities. Finally, it is long overdue that greater attention is given to the ways the climate crisis—and climate solutions—address the needs of the average person, as the relative failure to bring people along with the climate agenda is one important reason that political support for climate action has dwindled. This means not only a just transition, but also a burgeoning insurance crisis, addressing cost concerns that many have regarding the energy transition, and other steps.
6. Will business rediscover its voice in advocating for a rules-based international order, and rule of law more broadly?
Going into 2026, one question we have been debating inside BSR is “what kind of world do you want to do business in?” Business and the wider world have thrived over the past 30 years, based in no small part on a shared set of rules and expectations, open trade and societies, and respect for human rights. This enables investment with confidence and certainty, predictable rule of law regimes, and a relative absence of geopolitical conflict.
That is not the state of the world entering 2026. Business cannot afford to be a bystander as the pillars of the global trading system erode. Responding to this moment requires standing up to the voices promoting zero-sum policies. It also requires business to move beyond its comfort zone and attend to the reasons public support for markets and trade has declined in many parts of the world. These are not easy questions for big companies to address. Failing to do so, however, risks even further retreat from the conditions that enable companies to thrive.
We are living through a transitional period, with new framework conditions and new questions shaping sustainable business. None of this, however, changes the importance and urgency of achieving more rapid progress on a clean energy economy, responsible development and deployment of new technologies, a truly inclusive economy, and business strategies that are trusted and equipped to thrive in a time of change.
The six questions we pose will shape not only 2026. How we answer them will define the dynamic, complex, and important era we are living through.
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President and CEO, BSR
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