D&B: Will Falling Business Confidence Impact Sustainability?

According to data and analytics gurus at Dun & Bradstreet, businesses are grappling with declining confidence in 2025.

D&B's latest Global Business Optimism Insights report (published quarterly) reveals that, across the last two quarters, business confidence has fallen sharply by 14.2%.

The reasons are multitudinous, but economic uncertainty and the rise of trade protectionism are key factors in this drop-off.

A lack of confidence often pushes businesses to protect their bottom lines, which in turn influences their approaches to sustainability.

Although supply chain continuity expectations remain stable, the uncertain timeline for interest rate reductions has weakened overall investment sentiment, impacting environmentally conscious strategies and projects, as many businesses view sustainability as an outlay without an immediate return on investment.

“Amidst macroeconomic uncertainty, heightened capital costs and a dim growth forecast, businesses remain apprehensive about their sustainability initiatives,” says Neeraj Sahai, President of Dun & Bradstreet International.

“Redefined trade relationships and tariff uncertainties have led over 90% of surveyed economies, both emerging and advanced, to report a decline in financial confidence.

"This scenario also holds significant implications for their sustainability agendas.”

Global trade and the sustainability challenges therein

D&B has found that industries reliant on exports, like automotive, electricals and metals, have seen a particularly sharp drop in optimism.

Companies in the US, Mexico, South Korea and Japan report declining confidence due to tariff increases and evolving trade structures, which is further complicating things for sustainability departments across the corporate world.

Q1 of 2025 saw a 6% reduction in financial optimism from the previous three months, reflecting heightened perceived risks and tighter borrowing conditions.

The Global Business Financial Confidence Index saw an 8.6% decline, influenced by high capital costs and a weaker economic growth outlook, which is threatening to impact sustainability projects.

Confidence fell across all business sizes, but most notably in large enterprises. In the US, there is a pronounced concern about potential inflation rebounds and stricter monetary policies, which could detract from sustainability investments.

Stability and sustainability across supply chains

The Global Supply Chain Continuity Index remained constant, following a 10.7% decrease in the previous quarter.

This stability suggests a pause, rather than a recovery, in addressing long-standing disruptions affecting sustainability efforts.

Ongoing tension regarding US tariffs and geopolitical uncertainty exacerbates the situation, maintaining pressure on logistics and delivery performance.

This backdrop causes confidence in lead times to fall by 7.8% this quarter, with advanced economies experiencing a steeper 9.5% decline. These pressures make sustainable supply chain practices more challenging.

Faltering confidence in ESG

Another concern is the reversal in ESG expectations. The Global Business ESG Index fell 3.3%, marking the first decline after three quarters of steady improvement.

This dip is notably apparent in social and governance areas, despite a high awareness of environmental risks—77% of businesses recognise their importance, yet only 58% rate them as highly probable.

Globally, tighter monetary policies remain a significant concern, with 70% of businesses believing stricter policy settings are likely and 83% expecting them to materially impact their operations, including sustainability initiatives.

“The possibility of inflation resurgence, due to higher import tariffs, tempers expectations for interest rate cuts," says Arun Singh, Global Chief Economist at Dun & Bradstreet.

"This situation likely curtails business investment, impacting sustainability efforts and broader economic cycles.

“Global business challenges continue to impede recovery efforts and diminish financial resilience, particularly in large businesses which report greater declines in financial confidence.

“While economic conditions might slightly improve, the impact on sustainability practices will likely be delayed, placing additional strain on corporate balance sheets this year.”

Explore the latest edition of Sustainability Magazine and be part of the conversation at our global conference series, Sustainability LIVE. 

Discover all our upcoming events and secure your tickets today.

Sustainability Magazine is a BizClik brand