Investing in ESG (environmental, social, and governance) projects cannot and should not be just a marketing maneuver to improve the company’s image or to “act nice” on social media. Likes and views do not change the world. Nor do they sustain a reputation when there is a lack of coherence between words and actions. Genuine ESG requires intention, purpose, and real 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 fades or when a crisis arises? ESG cannot be a performance. It must be coherence. It’s not about looking responsible, it’s about being responsible even when no one is watching.
The consultancy Sustainalytics 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. Moreover, according to a global survey by PwC, a network of audit and consulting firms, 78% of investors say they may divest from companies engaged in greenwashing, emphasizing the importance of clear and auditable goals.
ESG washing, when companies use the ESG acronym only as a marketing tool, without adopting concrete and structured practices, has become one of the biggest risks to the credibility of the sustainable agenda. When an organization promotes environmental, social, or governance campaigns just to “look responsible,” without actually acting cohesively and deeply, it contributes to the trivialization of the topic and reduces the trust of the public and investors. These cosmetic actions, often accompanied by empty slogans and embellished reports, create a perception of opportunism. Instead of creating value, such practices weaken the company’s reputation and, more seriously, delegitimize the ESG movement as a whole. The public perceives when there is a disconnect between discourse and reality, which can lead to boycotts, regulatory investigations, and a reputational crisis that is difficult to reverse.
The negative impact is not limited to the company that engages in “washing.” When many organizations adopt this superficial approach, the entire market is contaminated with a kind of collective cynicism. Investors become more skeptical, regulatory bodies tighten requirements, and consumers become disillusioned with sustainability promises. The result is that companies that work diligently and invest in structural changes end up being lumped together with those that simply advertise. This confusion affects access to sustainable capital, reduces civil society engagement, and delays important progress. In other words, ESG washing is not just ineffective, it is a disguised obstacle to progress.
More than that, every ESG investment needs to be planned based on the company’s maturity level. It’s no use copying ready-made models or importing standards that don’t fit the business reality. We have seen a lot of “off-the-shelf ESG” in the market. What works for a multinational corporation may be unsustainable for a medium-sized company and so on.
Furthermore, the available budget and the external context, such as the economic scenario, political stability, regulatory requirements, must also be considered. ESG doesn’t live in a bubble. It lives 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 suffered setbacks mainly originating from the United States. During Donald Trump’s re-entry into the presidency on January 20, 2025, an executive order was immediately signed withdrawing the US from the Paris Agreement. Additionally, there was rapid dismantling of environmental regulation, such as agency cuts, reduction in emission monitoring, avoidance of the term “climate science” on official websites, and expedited 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 realm, the Trump administration implemented broad tariffs, with imports subject to average rates of up to 15%, disrupting global supply chains, raising 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 field, the so-called S and G of ESG, there were 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 standard or demonstrating differentiated financial impact. The combination of a hostile political environment, legislative obstruction, and a volatile economic climate has reduced companies’ and investors’ appetite for responsible initiatives. While Europe and parts of Asia maintain the pace of sustainable transition, the United States has weakened its global leadership role in ESG, fragmenting standards and making the sustainability market more complex and polarized.
Therefore, before posting, plan. Before promising, align with strategy. ESG that truly transforms does not start in marketing, it starts in governance. Intentionality, transparency, and ethics are the best allies for ESG programs.
