The commitment of Germany’s largest corporations to climate protection has demonstrably weakened, according to a new report released by the state-owned development bank KfW. The “Climate Barometer” compiled using data from a comprehensive survey conducted by market researchers GfK between February and June 2025, reveals a concerning downturn in climate-related investments, raising questions about the nation’s progress toward its emissions reduction targets.
After a period of significant expansion between 2021 and 2023, overall climate investments by the German economy have contracted, falling from €85 billion in 2023 to €80 billion last year. This decline is primarily attributable to a sharp reduction in spending by large corporations, whose climate investments plummeted from €50 billion to €42 billion over the same period. Smaller and medium-sized enterprises, conversely, marginally increased their contributions.
Dirk Schumacher, KfW’s chief economist, attributed the shift to a prioritization of alternative concerns among large businesses. The survey, encompassing responses from 13,272 businesses, indicates a significant decrease in the perceived pressure from consumers regarding environmental responsibility. Only one-third of large corporations now cite customer demands as a driving force for climate protection measures, a stark contrast to the over 45% who did so in the preceding three years.
The findings spark a debate about the efficacy of current policy incentives and the influence of broader economic uncertainties on corporate sustainability strategies. Critics argue that the prioritization of short-term financial performance over long-term environmental stewardship among Germany’s industrial giants undermines the nation’s leadership role in the global fight against climate change. The data also suggests a potential weakening in the broader societal expectation for corporate environmental action, highlighting the need for renewed efforts to reinforce the imperative of sustainable business practices. The downward trend raises questions about whether Germany can meet its ambitious decarbonization goals without a fundamental reassessment of corporate responsibility and government regulations.