Business in Ireland 2025 - Sustainability Through Innovation and Technology

Statistician's Comment

The Central Statistics Office (CSO) has today (24 March 2026) published Business in Ireland 2025 - Sustainability Through Innovation and Technology.

This is the second in a series of releases that brings together relevant enterprise economy statistics from a variety of outputs and looks at them through the lens of sustainability to provide greater insights around sustainability and climate targets (See Editor’s Note for more detail). 

Commenting on the release, Morgan O’Donnell, Statistician in the Sustainability, Circular Economy & Transport division said: “Sustainability is of increasing importance to enterprises, in terms of meeting environmental regulations and expectations, but also from an economic and social perspective.

There is increasing national and international recognition that economic growth alone is not a sufficient measure of success, and that long term prosperity depends on achieving a balanced integration of economic, environmental, and social outcomes. This release is the second in a series which attempts to build that broader picture and provide greater insights for enterprises around sustainability and climate targets.

The adoption of new and emerging technologies are generally considered an important factor in long-term economic, environmental, and social sustainability. We see in this release how foreign enterprises play a central role in research and innovation in Ireland, how the extent of digitalisation among Irish enterprises has increased in recent years across a range of areas, and how enterprises are using technology to reduce their environmental impact through improvements in energy and material use.

Innovation in Irish Enterprises

Investment in innovation can support long-term resilience and competitiveness while also contributing to social and environmental improvements. Ireland performs strongly in research and innovation at an international level, with enterprises playing a key role through investment in R&D. Expenditure on R&D by enterprises in Ireland is characterised by a very small number of enterprises, largely foreign, dominating the total R&D spend.

• Ireland ranked highly, 5th of 27 EU members, in a European Commission assessment of research and innovation in 2025.
• R&D expenditure by enterprises in Ireland increased significantly in recent years, up from €3.9 billion in 2021 to €7.0 billion in 2023, an increase of 81%.
• Enterprise spend on R&D is driven by foreign-owned enterprises which accounted for 84% or €5.9bn of all R&D expenditure by enterprises in Ireland in 2023.
• A relatively small number of enterprises accounted for a significant proportion of R&D spend with the top 10 enterprises accounting for more than half (58%) or €4.0 billion of total R&D expenditure by enterprises in 2023.
• There were 40,956 people employed in R&D activities in enterprises in Ireland in 2023, of which 53% or 21,537 people were employed in large enterprises (250+ persons engaged).
• Ireland ranked second in the EU in 2023 for enterprise expenditure on R&D per capita.

ICT, Innovation and Environmental Impact

Technological innovation can support resource efficiency within enterprises, allowing them to use fewer resources while producing the same or greater output. Lower energy consumption or reduced raw material usage may positively impact enterprises and the wider society through decreased production costs or environmental footprint.

• More than one-quarter (27%) of enterprises used ICT systems or solutions in 2025 to reduce energy consumption, with 66% of large enterprises doing so compared with 22% of small (10 to 49 persons engaged) enterprises.
• Almost one-fifth (18%) of enterprises used ICT systems or solutions to reduce materials used or enhance use of recycled materials in 2025.
• Half (50%) of large enterprises used ICT systems or solutions to reduce materials used or enhance use of recycled materials, compared with 30% of medium (50 to 249 persons engaged) enterprises and 15% of small enterprises.
• At 33%, Irish enterprises were ahead of the EU average (30%) in terms of using ICT to reduce their environmental impact (reduce energy consumption, or reduce materials used or enhance use of recycled materials).
• Large enterprises (69%) were significantly more likely to use ICT systems or solutions to reduce their environmental impact (reduced energy or materials used) than small (28%) or medium (50%) sized enterprises.
• Irish enterprises across all three enterprise size classes were more likely to use ICT to reduce their environmental impact than similar sized enterprises across the EU.

Further insight into enterprises’ concerns about climate change and their adoption of environmental innovations is provided by their responses to the CSO’s Community Innovation Survey in 2022, with further updates to come for reference year 2024 in the coming months. In relation to the innovation activities of enterprises in Ireland we saw that, in 2022:

• A quarter (25%) of enterprises said increasing costs or input prices resulting from climate change was of high importance to their enterprise, including almost a third (32%) of large enterprises, 27% of medium sized enterprises, and 22% of small enterprises.
• Enterprises that adopted at least one significant environmental innovation expressed a higher level of concern about climate change factors compared with non-innovators.
• Increasing costs or input prices resulting from climate change was of medium or high importance to three-quarters (75%) of enterprises that adopted at least one significant environmental innovation, compared with 45% of enterprises that did not adopt any significant environmental innovations.
• The most common type of environmental innovation introduced was reduced energy use or CO₂ footprint of the enterprise (18%), with large enterprises (39%) more likely to have introduced this type of innovation than medium-sized (21%) or small-sized (13%) enterprises.

Digital Sustainability and Artificial Intelligence Adoption

The adoption of digital technologies can support enterprise sustainability by fostering innovation and making enterprises more resilient and resource-efficient over the long term.

The extent of digitalisation among Irish enterprises has increased in recent years across a range of areas including Internet Access, Data Analytics, Cloud Computing and AI, with larger firms being strong adopters of new technology.

• Use of AI by enterprises more than doubled between 2023 and 2025, increasing from 8% to 20%.
• Adoption of AI by enterprises in Ireland is on par with the EU average of 20%, but significantly behind the EU leaders Denmark (42%) and Finland (38%).
• Large enterprises (58%) were significantly more likely to have used AI technology, compared with medium (29%) and small (17%) sized enterprises.
• Almost six in ten (59%) large enterprises had broadband speed of at least 500 Mbps, compared with 45% of medium enterprises and 35% of small enterprises.
• Between 2023 and 2025 the proportion of enterprises with broadband speed of 500 Mbps or more increased from 31% to 38%.
• Almost three-quarters (73%) of Irish enterprises used paid cloud computing services, such as email, software, or data storage, in 2025, the 4th highest among EU member states, behind Finland (79%), Italy (76%) and Malta (75%).
• The proportion of enterprises using cloud computing services for email (64%), office software (58%), finance or accounting software (53%) and storage of files (52%) increased notably between 2023 and 2025, with each increasing by 10 to 12 percentage points over that period.”

Editor's Note

This release is the second in a series of releases that will leverage existing data sources to provide insight on different aspects of sustainability from an enterprise perspective. The first release published on 25 February 2025 looked at Emissions and Energy Use by Enterprises.

The broad policy context relates to national and European Union (EU) climate action plans which state as their objective to be at “net zero” by 2050 and national policy for Irish-based enterprises to succeed through competitive advantage founded on sustainability, innovation, and productivity.

Sustainability is a multi-faceted concept that focuses on balancing environmental, economic and social considerations. Put simply, it is development which meets the needs of the present without compromising the ability of future generations to meet their own needs. Sustainability is of increasing importance to enterprises, in terms of meeting environmental regulations and expectations, but also from an economic and social perspective.

Future releases in this series will look at topics such as deglobalisation, and demographic changes and how these may affect the enterprise economy in terms of sustainability and productivity.