An anti-ESG movement that is gaining traction in various regions around the world is rooted in the US and will ultimately impact companies across all industries, according to a new report.
GlobalData’s Anti-ESG Movement report, which explores efforts among varying actors to stifle environmental, social, and governance (ESG) investment and initiatives, states that the current rising tide of anti-ESG sentiment “started gaining traction in 2021, when the Texas state legislature passed a bill banning financial institutions from boycotting fossil fuel companies.”
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It suggests that financial services companies like banks, asset managers and pension funds have been the primary targets of anti-ESG efforts since then and have been targeted with anti-boycott laws and lawsuits. Indeed, the report points to a Pleaides Strategy tracker that identified more than 370 anti-ESG bills submitted to the legislature of 40 US states between 2021 and 2024.
“Very few of these bills were signed into law,” it says. “While some were amended, many have been declared dead. In 2024, the number of anti-ESG bills fell, but this does not signify that anti-ESG efforts weakened during this time. In fact, anti-ESG bills filed in 2024 had a far higher rate of success than those in 2023, according to analysis by Ropes and Gray. This suggests the anti-ESG movement is focusing more on the efficacy of its legislative challenges. The number of anti-ESG bills filed is expected to ramp back up in 2025.”
Trump re-election an anti-ESG milestone
Perhaps unsurprisingly, the re-election of Donald Trump as US President last year is identified as a key milestone for the anti-ESG movement.
“Since President Trump’s re-election in November 2024, the efforts of the anti-ESG movement have ratcheted up, and all companies (not just those in the financial services industry) lie within the movement’s scope,” the report states. “Trump has unravelled much of the previous administration’s climate action policies, passed executive orders banning ESG investing and taken aim at DEI policies.”
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By GlobalDataFor businesses, maintaining environmentally and socially responsible policies generates political risk, it is suggested, while failing to implement such policies exposes them to legal, financial and potentially existential risk. The report contends that companies should develop strategies for responding to the anti-ESG movement and the legal intricacies that come with it.
“Having properly assessed the risk associated with either keeping or dropping ESG, companies should ensure that any ESG policies they do keep are aligned with their core business objectives,” the report advises. “This will include goals like maximising revenue and minimising costs. A key part of this will be implementing sustainability and net-zero strategies with a clear return on investment beyond climate mitigation and regulatory compliance. This will help to ensure that companies can justify their ESG policies to any anti-ESG actors, like right-wing US lawmakers, and that they do not violate upcoming anti-ESG legislation.”
