The Politicization of ESG happened without anyone asking ESG professionals. We were minding our own business when the congressional investigations, letters from attorneys general, and antitrust accusations rolled in. ESG has become a common target for the right side of the aisle, while the left mounts a tepid defense. Mostly, it falls to those in the crosshairs to defend themselves, something several have done successfully. Ultimately, while we try to stay above the political theater, there is no doubt it has impacted the field. This blog has always advocated for a common-sense position. Assessing and managing risks and opportunities is the priority, not political statements. A recent ArentFox Schiff memo discusses this, arguing that we should not let politics get in the way of good business practice:
“A company contemplating a long-lived investment should use the best reasonably available information about conditions that could affect it. Reliable evidence of flood exposure, water constraints, or extreme heat matters because it can affect equipment, production, workers, and electrical reliability — not because considering it implies a position in the climate debate.
Marsh’s 2026 Climate Adaptation Survey, covering more than 120 organizations across eight regions, found that 60% of respondents were confronting multiple perils, with flooding, extreme heat, and water stress identified as the leading risks. Only 57% of respondents were conducting forward-looking assessments. Among those conducting assessments, 77% incorporated quantitative methods.
Companies routinely model uncertain futures, forecasting demand, commodity prices, interest rates, electricity costs, and regulatory developments. Management evaluates the quality of the information, potential consequences, and mitigation costs. Physical risks should not be treated differently merely because some relevant information is associated with climate. The goal is not to make a political statement, but to avoid bad investments caused by disregarding relevant information.”
Ultimately, ESG serves to make businesses successful. Incidentally, that also includes working towards a livable climate and available natural resources. That is something that most folks can get behind. By protecting our businesses, we protect ourselves and society. Politicians have the luxury of a soapbox where they can dictate the narrative from their point of view. However, we don’t live in the world as they envision it. We live in a world full of sustainability-related risks, and those must be managed. It’s our job to push back on narratives that drive the politicization of ESG and keep our work grounded in reality.
Our members can learn more about ESG business value here.
