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Companies that can identify sustainability technologies with the potential to scale faster than the broader market and direct capital towards them could gain a competitive advantage over the next decade, according to a report by Bain & Company.
The report said the sustainability transition has entered an age of divergence, with different technologies, industries and markets progressing at different speeds. It said companies should focus on areas where technology, policy and consumer behaviour are likely to drive growth, instead of spreading investments across all sustainability opportunities or moving away from them. According to Bain, private companies and governments have invested USD 17 trillion in sustainable technologies over the past decade. Investment reached a record USD 2.4 trillion in 2025. However, the report noted that investment and technological progress have been uneven. Of the 37 sustainable technologies tracked by Bain since 2015, only three solar, batteries and electric vehicles outperformed forecasts, while 29 failed to meet expectations. Bain said three key factors, technology, consumer behaviour and policy determine whether sustainable technologies can achieve scale. Solar energy, battery storage and electric vehicles have emerged as major outperformers. Other technologies have progressed more slowly because of challenges related to costs, infrastructure, policy and consumer adoption. The report also highlighted Asia's growing role in the energy transition. China and India together account for 46 per cent of the change in 2040 carbon emissions across Bain's energy scenarios, compared with 18 per cent for the United States and European Union combined. Asia attracted USD 947 billion in energy-transition investment in 2025, the report said. Bain also found that consumer concern over environmental sustainability is rising. About 85 per cent of 7,500 consumers surveyed across the US, UK, Italy, Brazil and Indonesia said they were concerned about environmental sustainability, up from 79 per cent last year. The report said 83 per cent of respondents had adopted three or more sustainable lifestyle habits, compared with 73 per cent in 2023. Consumers were also willing to pay an average 18 per cent more for sustainable products, rising to 24 per cent when such products also offered a health benefit. Bain said companies should follow a shape, monitor, or avoid approach. This means investing actively in areas where they have strong conviction, monitoring uncertain opportunities and avoiding technologies that are unlikely to have a material impact on their businesses. The report notes that sustainability leadership will depend less on predicting the future with certainty and more on identifying areas where change could happen faster than expected and directing capital accordingly. (ANI)
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