Why Business Leaders Must Resist the Anti-ESG Movement

To The Gold Mine

Key Points

Read Time: 15 mins

Managing a company’s role in society has become a challenging task for leaders, as they are increasingly exposed to the culture wars. Decisions on sensitive issues such as diversity, equity and inclusion(DEI), LGBTQ+ rights, abortion, and ESG investing are being criticized by right-leaning politicians and pundits.

This article argues that leaders cannot avoid these topics and that it is their business and moral responsibility to address them with courage.

To do so, leaders must prioritize preparing for and responding to accusations of “woke-ness,” and not let loud voices prevent them from doing what their business is meant to do.

Leaders must develop a strategy for corporate political responsibility and demonstrate consistency of values to all stakeholders.

Do the right thing. A most-likely larger group, especially younger customers and employees, wants you to stand up for marginalized groups and be consistent about your values – even if it’s uncomfortable.

Develop your courage muscle. When facing the forces of illogic and intolerance, stand up and show your employees and other stakeholders that it’s unacceptable for your business, for your values, and for society.

Some companies have adopted a middle-ground approach called “greenhushing,” where they continue their environmental and social efforts but remain quiet about it. However, staying silent causes companies to miss the opportunity to gather allies and build collective courage.

Some interesting case studies and examples mentioned in the article include.

·       The case of Walt Disney Company and the GOP governor and legislature of Florida, who came after Disney over social issues, especially the LGBTQ+ rights.

·       The tough choices companies face in the wake of the Dobbs U.S. Supreme Court decision that overturned the right to abortion.

·       The rise of Chief Diversity Officer roles and companies' commitment to DEI in recent years, and how the anti-ESG crowd regularly attacks DEI

·       ESG investing and the growth of ESG funds to over$100 trillion in 2022

·       Vanguard withdrawal from a global agreement to move its portfolios to net zero carbon by 2050.



Harvard Business Review