Investing in ESG (environmental, social, and governance) projects cannot and should not be just a marketing ploy to improve the company's image or to "appear good" on social media. Likes and views don't change the world. They do not support a reputation either when there is a lack of coherence between speech and practice. True ESG requires intention, purpose, and genuine commitment to positive impact.
It's easy to fall into the temptation of launching a campaign on social media with beautiful photos, inspiring speeches, and trendy hashtags. But what happens when the spotlight goes out or the crisis arrives? ESG cannot be performance. It must be consistency. It's not about seeming responsible, it's about being responsible even when no one is watching.
Sustainalytics consulting recently identified that 50% of companies with ESG goals lack internal governance compatible with their public commitments, which weakens the effectiveness and perception of these actions. Furthermore, according to a global PwC survey of audit and consulting service firms, 78% of investors say they could divest from companies involved in greenwashing, reinforcing the importance of clear and auditable goals.
ESG washing, when companies use the ESG acronym solely as a marketing tool without adopting concrete and structured practices, has become one of the biggest risks to the credibility of the sustainability agenda. When an organization promotes environmental, social, or governance campaigns solely to "appear responsible," without genuinely acting with consistency and depth, it contributes to the trivialization of the issue and diminishes the trust of the public and investors. These cosmetic actions, often accompanied by empty slogans and polished reports, create a perception of opportunism. Instead of generating value, such practices weaken the company's reputation and, more seriously, delegitimize the ESG movement as a whole. The audience perceives when there is a disconnect between speech and reality, and this can lead to boycotts, regulatory investigations, and a difficult-to-reverse reputational crisis.
The negative impact is not limited to the company that commits the "washing". When many organizations adopt this superficial approach, the entire market becomes contaminated with a kind of collective cynicism. Investors become more skeptical, regulatory agencies tighten requirements, and consumers become disillusioned with sustainability promises. The result is that companies that work seriously and invest in structural changes end up being grouped together with those that only do advertising. This confusion affects access to sustainable capital, reduces civil society engagement, and delays important progress. In other words, ESG washing is not only ineffective, but it is a disguised brake on progress.
Moreover, all ESG investments must be planned based on the company's level of maturity. It's no use copying ready-made models or importing standards that don't fit the reality of the business. We have seen a lot of "off-the-shelf ESG" in the market. What works for a multinational may be unsustainable for a medium-sized company and vice versa.
Additionally, the available budget and the external context, such as the economic scenario, political stability, and regulatory requirements, must also be considered. ESG does not live in a bubble. Live in the real world, with its complexities, risks, and opportunities. Therefore, a sense of realism is essential in the ESG journey.
The ESG market has faced setbacks mainly originating from the United States. During Donald Trump's reentry into the presidency on January 20, 2025, an executive order was immediately signed withdrawing the US from the Paris Agreement. Furthermore, there has been accelerated dismantling of environmental regulation, such as cuts to agencies, reduction of emission monitoring, sidelining the words "climate science" on official websites, and eased approval of fossil fuel projects on public lands. This legislative and institutional reversal inaugurated the so-called "greenhushing," where companies continue with sustainable investments but avoid labeling them as ESG or "green" to minimize political risks and negative repercussions.
In the economic sphere, the Trump administration implemented broad tariffs, with imports subject to average rates of up to 15%, disrupting global supply chains, increasing input costs, and generating widespread uncertainty. The resulting crisis caused a global market crash in April 2025, directly impacting companies committed to clean energy and turning sustainable projects into higher-risk investments.
In the social and governance fields, the so-called S and G of ESG, there have been significant setbacks. Federal Diversity, Equity, and Inclusion (DEI) programs were eliminated by executive orders, and the Department of Labor proposed rules to prevent retirement plans from considering ESG factors as a standard or demonstrating differentiated financial impact. The combination of a hostile political environment, legislative obstruction, and volatile economic climate has reduced the appetite of companies and investors for responsible initiatives. Although Europe and parts of Asia maintain the pace of sustainable transition, the US have weakened their global leadership role in ESG, fragmenting standards and making the sustainability market more complex and polarized.
Therefore, before posting, plan. Before promising, align with the strategy. ESG that transforms doesn't start with marketing, it starts with governance. Intentionality, transparency, and ethics are the best allies for ESG programs.
