A mixed-methods approach that combines quantitative and qualitative indicators supports the assessment of ESG (environmental, social, governance) criteria and corresponding sustainability strategies. For Albania – a middle-income country with stable economic growth – ESG analyses show significant progress in environmental indicators, especially when compared to the regions in the Western Balkans. Nevertheless, challenges remain, for example in air and water pollution, deforestation and the consequences of climate change. Despite legal alignment with EU standards, there is a lack of institutional and technical implementation capacity.
A detailed assessment of seven environmental indicators identifies the energy sector as a key lever for sustainable development. Closely linked to water, food and land use, the aging energy system requires reforms, investment, policy incentives and more public participation to enable the transition to a low-carbon economy.
Albania’s climate risk profile shows moderate exposure to environmental hazards, with socio-economic and geographical factors increasing vulnerability. Risk mitigation strategies, stronger cross-sectoral coordination and international support are needed to increase resilience. In the social sector, there are structural deficits such as informal employment, youth unemployment and brain drain. The EU accession process promotes alignment with social and governance standards, with reforms, anti-corruption measures and improved disclosure strengthening transparency and sustainability.