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Get a head start by honing your strategies in relation to the big challenges ahead: sustainability, AI, hybrid work, geopolitical shifts, and multistakeholder collaboration.

The New Year is a good time to take stock of the progress your business is making and to reflect on the big goals you’ve set for the year ahead.

Sustainable development is an urgent issue, with just five years left to achieve the 2030 Agenda. And there are a host of other pressing concerns, from the accelerating impact of artificial intelligence (AI) to evolving organizational dynamics that will affect your ability to remain competitive in a challenging economic landscape.

The top business trends of 2025

Here are five key trends, rooted in ÌìÃÀ´«Ã½ research, which are bound to shape your business strategy in 2025. Add these action items to your agenda.

1. Integrate sustainability — with care

Which Sustainable Development Goals have you set for your company? How close are you to achieving them? To move the goals from theory to practice, Pascual Berrone and Joan Enric Ricart recommend you carve out time to prioritize, contextualize, collaborate and innovate.

Some increasingly popular practices are to link executive compensation to ESG criteria, to pay carbon taxes, and to support low-emission zones in heavily trafficked areas. Although each of these has its merits, be aware of the potential downsides, and plan accordingly.

For example, ESG-linked pay signals the seriousness of your commitment to people and the planet, yet Gaizka Ormazabal and Igor Kadach find it may not deliver financial gains in the short term. So, consider it a forward-looking move for long-term payoff.

Likewise, with emission taxes, Martin Jacob finds they can add financial burdens, leading companies to cut investments in, say, green technology. Paying the tax should not be an excuse to underinvest or to pass the extra costs on to consumers or suppliers.

And while low-emission zones may help reduce pollution, Ricard Gil warns they may also reduce trade in the commercial zones affected. You must carefully weigh the pros and cons of each action you take, and account for the necessary tradeoffs.

2. Develop AI skill sets to leverage AI effectively

The adoption of AI has wide implications for work. The debate is no longer over whether AI will steal your job but rather how your job — and you — will need to change as a result of AI. Highly knowledgeable workers are generally well placed to reap the most benefits, according to Enrique Ide and Eduard Talamas.

This should motivate you to boost your AI knowledge. In doing so, you may find yourself in even more demand. José Azar, Mireia Giné and Sampsa Samila studied 12 years’ worth of job postings and detected greater demand for managers with AI skill sets, particularly data analysis, creativity, stakeholder management and problem-solving around ethical concerns related to privacy and data biases. The more you collaborate with AI, the more you may discover that it doesn’t just make your existing processes more efficient; it changes the processes themselves. This requires more human judgment to make the strategic calls from among the myriad solutions AI is capable of generating for you.

3. Try hybrid organizational models

Is your organization hierarchical or flat? Just as we saw teleworking become the norm during the pandemic and now people are increasingly being called back into the office, we are also seeing pendulum swings in relation to flat organizational models. Middle managers were done away with, but at the same time they are also more in demand. Mireia Las Heras and Anneloes Raes perceive benefits to both models. As with teleworking versus in-person work, the future is not either/or but both — hybrid solutions are increasingly the answer.

Recognizing that what works for one company won’t necessarily work for others, Sebastian Reiche developed an award-winning work-design framework to help managers and HR teams figure out which configurations are best for their organization. The core aspects to consider are the level of work autonomy versus work interdependence — these are the key factors shaping organizational structures today.

4. Stay on top of geopolitical shifts, adapting your financial strategies accordingly

Controlling inflation and debt remain make-or-break challenges for many. Ramped-up geopolitical tensions will undoubtedly have an impact on supply chains, trade and the ability of businesses to keep costs under control during the year ahead.

What lessons can be drawn from the 2008 global financial crisis? Christian Eufinger warns against a return to zombie credit, where economically unviable firms were kept propped up by central bank lifelines. This is something the Chinese government appears to be doing, supporting distressed borrowers there, and resulting in an influx of cheaper, subsidized goods into Western markets. This might cause disinflation. Excessive supply brings prices down, which might tempt interest rate cuts, but it also risks pricing out local suppliers. Be prepared.

Balance sheets are best when boring, but with a major change in direction under the incoming Trump Administration, global investors and business leaders should expect things to be anything but boring over the next four years. David Teeters wonders whether we might see the U.S. dollar lose its hegemony as a reserve asset or else a new era of dollar dominance. Either way, we will need to act nimbly in response to U.S. Treasury moves.

5. Collaborate with diverse stakeholders

Finally, amid a growing sense of isolationism and protectionism, companies can remain steadfast in their own commitment to alliance-building and multistakeholder partnerships. Business leaders should resist contributing to the general air of divisiveness and polarization. Instead, they should uphold the dignity of all persons and promote community-building and belonging, not only as a moral imperative but because doing so inspires the innovation necessary for competitiveness. Business leaders must try to build lasting relationships with the local communities in which they operate, addressing systemic issues, such as , which threaten to undermine the social fabric.

Nowhere is this clearer than in the case of climate change — an all-hands-on-deck effort for humanity. Global collaboration and cooperation are urgently needed. And lest you doubt we can overcome our rivalries and come together for the common good, Sebastian Hafenbrädl offers a ray of hope: his study involving children from different cultures shows people can indeed set aside self-interest for the sake of a prosocial group goal. If kids can do it, maybe we have a future after all!

READ ALSO: Uncertainty ahead: 10 trends that will impact 2025, according to Tom Standage of The Economist.

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This article is published as part of Smart Picks in ÌìÃÀ´«Ã½ Insight magazine #169 (Jan.-April 2025).