By Steven Cohen, Ph.D., Director of the M.S. in Sustainability Management program, School of Professional Studies
While the United States government retreats from the green economy and sustainability management, corporations in America and around the world persist in the face of attack. Some of the critiques of sustainability were in response to overzealous ESG management—and companies are correcting those excesses—but despite the ideological back and forth, environmental and social governance issues are gradually being incorporated into routine organizational management. Well-managed organizations are paying attention to their environmental and community impacts, continue to enhance their management of human resources, and will never stop searching globally for top-quality staff. We’ve even seen some isolated corporate pushback from the ideological idiocy emanating from the United States Environmental Protection Agency. According to Maxine Joselow and Lisa Friedman in the New York Times:
“Lee Zeldin, the administrator of the Environmental Protection Agency, has quietly retreated from plans to eliminate Energy Star, a popular program whose iconic blue labels help consumers to choose energy efficient dishwashers, refrigerators and other home appliances. In a rare shift, Mr. Zeldin is reconsidering his announcement from May that he would end the program, which triggered intense pushback from business leaders and congressional Republicans, according to four people briefed on the matter who were not authorized to discuss it publicly…Since its creation in 1992, Energy Star has helped households and businesses save more than $40 billion annually in energy bills, according to a 2023 federal report. The E.P.A. has spent a fraction of that amount — about $32 million — to run the program each year… In their zeal to terminate what President Trump has called the “green new scam,” agency officials have scrapped several other policies that even their allies in the oil, automotive and utility industries were not clamoring to reverse.”
Saving money on energy while continuing to enjoy the increased convenience of modern appliances is hugely popular with the public and seen by manufacturers and retail outlets as a way of increasing sales. When a new product is less expensive to operate than an old product, people are motivated to replace the old product.
While corporate sustainability reporting requirements are being adjusted to reduce the costs of compliance, they are continuing, particularly in the European Union (EU). According to the European Commission, the revised corporate sustainability reporting directive now states that:
“…only companies that have more than 1,000 employees and either a turnover above €50 million [or $57.6M dollars] or a balance sheet total above €25 million will remain subject to the rules”
According to a report in ESG Today by Mark Segal on September 29, 2025:
“A majority of companies subject to…[carbon] disclosure requirements say that pressure from a variety of stakeholders including investors and customers to provide sustainability reporting and data has continued to increase over the past year, despite regulators in some areas pulling back on mandatory disclosure requirements, with most also increasing investments in sustainability reporting capabilities, according to a new report by global professional services firm PwC. For the report, Global Sustainability Reporting Survey 2025, PwC surveyed nearly 500 executives and senior professionals across 40 countries, at companies that have, or expect to, report under the CSRD [EU’s Corporate Sustainability Reporting Directive] or ISSB [International Sustainability Standards Board] frameworks. Of those surveyed, 36% said that their companies have already published sustainability statements under either the CSRD or ISSB, while another 41% plan to report under CSRD, and 23% plan to report under the ISSB…Even as regulators recalibrate, however, over half of the companies surveyed by PwC reported that they continue to experience growing pressure to provide sustainability reporting and data, from both internal and external stakeholders, and only 7% reported that pressure for sustainability reporting had actually decreased over the past year… Despite the regulatory pullback, the majority of companies continue to increase their investments in sustainability reporting. According to the survey, 66% of companies reported increasing the amount of resources devoted to sustainability reporting over the past year, and 65% have increased senior leadership time, compared to only 6% of those reporting decreasing investment in sustainability reporting.”
While politicians can afford to operate in an ideological land of fantasy, business executives do not have that luxury. They must operate on a warming planet with extreme weather events of increasing intensity. Perhaps the businesses in Jamaica might have something profound to say to climate deniers about the impact of 185-mile-an-hour winds on profitability. Global corporations are faced with critical issues of energy supply and energy price. Energy efficiency is simply sound management practice. Businesses must demonstrate to investors that they are mindful of environmental risk and have metrics to manage both their exposure to risk and their contribution to the environmental risks that governments around the world will continue to regulate, even if the U.S. federal government does not.
The Trump Administration’s environmental policies are the outliers both on the world stage and when compared to state and local policy preferences here in the United States. One of the reasons that companies are concerned about the EPA abandoning the greenhouse gas endangerment finding is that national corporations are worried that an absence of national greenhouse gas rules will lead to an unpredictable array of state and local standards. They would prefer a mild federal rule that pre-empts more stringent state and local regulations. It is indeed ironic that America’s business community needs to explain the public’s support of environmental protection and the benefits of energy efficiency to the ideologues running what remains of the U.S. EPA.
While sustainability principles are becoming more routine in organizational management, the one place where attacks on ESG are sticking is in the funds that invest in companies that have high ESG rating scores. These funds have had a mixed record of success, in part, because companies that assert sustainability principles and attract investment from these funds may not have fully internalized sustainability into their organization’s management system. The integration of this form of management innovation is a process that takes many years rather than a few months to complete. I would argue that these ratings of corporate sustainability are not particularly sound. Of course, the attacks on ESG funds are multifaceted. As Steve Johnson reported in the Financial Times this past April:
“Investors pulled a record amount from “sustainable” funds in the first quarter of the year, in an early sign that the US backlash against environmental, social and governance-based investing is going global. While US investors cut their exposure to sustainable mutual and exchange traded funds for a 10th straight quarter, Europeans were net sellers for the first time on record in data going back to 2018, pulling out $1.2bn, according to data from Morningstar. With Asian investors also cutting exposure, the $8.6bn of net outflows is by far the highest withdrawal figure ever seen. The outflows indicate that the pushback against funds that invest on the basis of ESG factors may be spreading to Europe, the region where the concept first took hold and which accounts for 84 per cent of the $3.2tn held in ESG funds globally. ESG has been criticised by many on the political right, who argue it prioritises contentious social and political agendas over financial returns, ushering in a form of “woke capitalism”. While these concerns have been strongest in the US, there has also been a pushback against ESG funds’ traditional disdain for defence stocks in Europe, amid a drive for the continent to re-arm following Russia’s 2022 invasion of Ukraine and doubts over the Trump administration’s support for Kyiv.”
In my view, there is a conceptual confusion here that is exacerbated by funds making investment decisions based on unaudited ESG reports rather than detailed analyses of the presence of sustainability principles integrated into routine organizational management. The growth of some of these funds was due to a need to respond to governments, unions, and other institutions attempting, and at times required, to steer pension and endowment investment to funds that could claim to guide their investments by ethical as well as financial principles. These funds had customers before they had truly sustainable organizations to invest in. In short, claims of sustainability may be overblown, and when ESG funds were attacked politically, they could not argue that the companies they had invested in were better managed than some alternatives.
To conclude, while excesses are being reigned in, sustainability management persists and is becoming an integrated element of routine management in the best-managed companies. I expect this to continue, along with the growth of the “green economy” of more sustainably managed firms and businesses producing goods and services that contribute to the long-term development of economic circularity.
Views and opinions expressed here are those of the authors, and do not necessarily reflect the official position of Columbia School of Professional Studies or Columbia University.
About the Program
The Columbia University M.S. in Sustainability Management program offered by the School of Professional Studies in partnership with the Climate School provides students cutting-edge policy and management tools they can use to help public and private organizations and governments address environmental impacts and risks, pollution control, and remediation to achieve sustainability. The program is customized for working professionals and is offered as both a full- and part-time course of study.
