How sustainability can emerge stronger from the ESG pushback
May 27 - The pushback against sustainability has surprised many, but it should not have. Banks have walked away from the Net-Zero Banking Alliance, which itself voted to disband in October 2025.
The European Union has pulled back the scope of its Corporate Sustainability Due Diligence Directive and due diligence legislation. More than 480 anti-ESG bills have been filed in U.S. state legislatures since 2021, with over 50 enacted. The world is on course to deliver only about 35% of the milestones agreed under the 2015–30 Sustainable Development Goals , News.az reports, citing Reuters.
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It is tempting to read this as an external assault on a sound enterprise. It is more honest to read it as a violent correction – and to acknowledge that those of us who work in sustainability have, in different ways, been complicit in allowing sustainability intent to drift so far ahead of delivery.
This arbitrage has allowed some businesses and political leaders to cynically “short” sustainability (both metaphorically and sometimes literally). The pushback against sustainable was inevitable – perhaps a sign of sustainability’s growing potency – but its severity has been partly self-inflicted.
Three forms of our complicity stand out. The first is the “notorious ESG” problem, as Vasuki Shastry has named it. ESG began as a narrow tool to help investors price environmental, social and governance risk into returns. We then let it expand, with little resistance, into a stand-in for sustainability itself.
ESG as input – information that improves a decision – and ESG as output – a claim about real-world performance – are very different things, and we conflated them. The result was a target so broad anyone could hit it, and so loosely defined it could be dismissed as "woke capitalism" by anyone who wished to. It was a gift to our critics that we did not have to provide.
The second is the gap between commitment and delivery. Sustainability pledges have routinely been made by teams that do not control capital allocation, operational priorities or delivery timelines. Ambition was decoupled from capability. Statements moved faster than systems.
Once that gap opens, organisations get trapped in a cycle of escalation: correction feels like retreat, qualification feels like failure, and each year's communications must sustain a claim whose internal credibility is already weakening. Greenwashing is the visible end of that pattern. Greenhushing – the retreat into silence – is the next stage, and no more durable.
The third form of our complicity is ignoring place-based realities. The sustainability profession is, broadly, urban, well-educated and global by instinct. The impacts of transitions are felt locally, and the politics that follow are local, too. Farmers in India and Europe, working communities in steel towns and energy regions, have watched their livelihoods become bargaining chips in negotiations conducted somewhere else.
Concerns about jobs, costs and pace are not climate denial; they are the lived experience of people being asked to bear costs whose benefits are described in technical language by people they have never met. Those opposed to action have proved much better at place-based politics than those advocating for it.
None of this is the whole story of the pushback. Genuine bad-faith actors are exploiting the moment. But the bubble was real, the failure to deliver was real, and the complacency was real. The question now is where do we go from here?
The answer is not retreat, nor a search for ever-more-comprehensive frameworks. It is operational repositioning. Sustainability endures only when it sits at what I call bedrock: embedded where capital is allocated, risk is priced, supply chains are designed, and losses are realised.
A sustainability issue reaches bedrock when it can no longer be deferred, delegated or externalised without undermining the stability of the system itself. At that level, trade-offs must be made explicit, costs must be carried, and responsibility cannot be displaced. An organisation that has remade sustainability can be recognised not by its commitments but by its behaviour under constraint.
Four arenas are already at bedrock. Finance: banks can leave alliances, but they cannot leave the loan books in which climate risk is now embedded in stress tests, models and supervisory expectations. Value chains: critical minerals, water, food and energy security have made supply systems contested rather than abstract, and voluntary standards cannot resolve the trade-offs. Leadership: sustainability becomes real when the trade-offs move from the chief sustainability officer into the hands of the CEO, CFO, COO and CTO, who must own them. Legitimacy: the social licence to implement is earned through visible, repeated decisions that are difficult, consistently applied and felt as fair by those who bear their consequences.
The future will not be tidy. We are living through what Antonio Gramsci called a “time of monsters”: where old frameworks no longer command confidence and new ones struggle to establish legitimacy. Living with monsters means designing systems that adapt gracefully rather than fail catastrophically, organisations that can reconfigure rather than freeze and cultures that reward learning rather than denial.
Sustainability will be stronger after this pushback than before it. It will be stronger because it will be harder, more operational and more earned. The question now is how we use the opportunity of the pushback to push back.
By Faig Mahmudov
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