Key Takeaways
- ESG transcends politics: Despite shifting U.S. policies, stakeholder demand for corporate sustainability continues to grow across political lines, making ESG a universal priority.
- Economic benefits drive ESG adoption: ESG initiatives, like renewable energy and clean energy investments, are cost-effective and create significant financial and job opportunities, appealing to both conservative and liberal agendas.
- ESG enhances business performance: Companies with strong ESG practices see faster growth, higher valuations, and lower operational costs, making it a practical strategy for long-term success.
- Corporate responsibility is bipartisan: Surveys show widespread voter agreement across party lines that businesses should positively impact their communities, demonstrating the bipartisan support for ESG principles.
Elections often bring shifts in policy priorities, and the 2024 U.S. election was no exception. With Trump entering a second term, the future of stateside environmental, social, and governance (ESG) initiatives stateside remains uncertain. However, while federal policies may influence the ESG landscape, they are not the sole drivers of its momentum. Stakeholder demand for corporate sustainability continues to grow across political lines, and companies maintain their ESG commitments because these practices directly impact their business. Recent Morgan Stanley research underscores the widely recognized trend that sustainable brands outperform non-sustainable brands—in this case, by nearly 50%. Moreover, ESG goes beyond the U.S. regulatory environment—it is also shaped by state policies, international agreements, and cross-border investment flows. This article examines why ESG remains critical for business success regardless of policy shifts.
Corporate social responsibility is a hard-edged business decision. Not because it is a nice thing to do or because people are forcing us to do it … because it is good for our business. Niall Fitzgerald, the former CEO of Unilever
Niall Fitzgerald the former CEO of Unilever
Beyond politics: The universal appeal of ESG
The underlying principles of ESG—sustainability, fairness, and corporate integrity—resonate with stakeholders from all walks of life, transcending the political divide. For example, research indicates that most U.S. voters (76%) agree that companies should positively impact the communities in which they operate. This sentiment was shared by both Republicans (69%) and Democrats (82%), highlighting the bipartisan nature of corporate responsibility. Moreover, the economic impact of ESG initiatives is becoming more apparent to voters across the spectrum. One study found that many see corporate environmental efforts as directly linked to their financial futures.
| Corporate action | Republican | Democrat |
| Climate change mitigation | 53% | 80% |
| Land and water conservation | 68% | 81% |
| Restoring and protecting ecosystems | 57% | 77% |
| Waste management | 61% | 76% |
| Energy management | 65% | 79% |
It often boils down to economics
The economic rationale for ESG initiatives is a major factor in attracting support across political lines. Renewable energy, for example, is more cost-effective than traditional fossil fuels, making it both an environmentally and fiscally sound option. That’s why there has been significant investment in renewable energy production across the U.S., including in some conservative states like Texas and Iowa, which traditionally lean Republican. This consensus is more than just a political statement; it reflects the fact that ESG is a practical economic strategy.
Another prime example is the Inflation Reduction Act (IRA), which aims to fast-track the U.S. transition to clean energy. Despite opposition from some quarters, including threats of repeal, the Act has garnered cross-party support due to its economic benefits. Notably, 18 House Republicans recently championed the IRA’s incentives, which is unsurprising since nearly 80% of new clean energy investments have flowed to Republican districts. Projects announced in the first two years of the law are anticipated to support over 600,000 jobs and generate billions in economic benefits once operational. These examples highlight how ESG initiatives can support financial interests across various political viewpoints.
The enduring business case for ESG
Economics is a crucial driver for businesses as well. Companies with strong ESG profiles are more appealing to key stakeholders such as investors, customers, partners, and employees, which yield direct benefits to the bottom line. As a case in point, McKinsey found that businesses with comprehensive ESG implementations see 10-20% faster growth, higher valuations, and 5-10% lower costs. Here’s a closer look at how a robust ESG approach translates into measurable gains across different stakeholder groups:
Investors: Most investors (99%) rely on ESG disclosures for investment decisions, and more than half plan to increase their allocation to sustainable investments. And for good reason—sustainable funds outperform their traditional counterparts by 50%.
70% of investors believe strong ESG practices can lead to higher returns.
Morgan Stanley
Consumers: Global consumers increasingly favor brands that prioritize sustainability, and 80% are willing to pay nearly 10% more for sustainable products. As a result, responsible brands see higher revenue growth and enhanced customer loyalty. Sustainable products also grow two times faster than conventional ones.
Sustainable products make up less than one-fifth of the CPG market, but they delivered one-third of the market growth between 2013 and 2023.
NYU Stern
Suppliers: 70% of companies plan to use emissions data in procurement decisions, and 88% of supply chain leaders collect ESG data from their suppliers at least once a year. The financial advantages of this are clear since the supply chain accounts for 50-70% of an organization’s operating costs. Organizations with strong ESG practices in their supply chains have reported profit margin improvements between 1-3% and stock market premiums exceeding 10%.
Employees: By fostering a sustainable, inclusive workplace environment, companies can tap into diverse talent pools, drive innovation, and strengthen employee engagement and retention. Two out of three employees prefer to apply for and accept jobs from sustainable companies because they want to work for companies whose values align with their own. And companies with an engaged workforce outperform their competitors by 147%. They also have higher productivity (18%), customer loyalty (10%), and profitability (23%) than companies with unengaged employees.
More stakeholder benefits: Companies with strong ESG ratings are more attractive to stakeholders, so they tend to incur lower costs in workforce management, financing, and more. Investors and lenders view them as a lower credit risk because they are less vulnerable to environmental disruptions or fines. As a result, high ESG scores can reduce a firm's cost of capital by 10%, according to McKinsey.
Benefits beyond stakeholders
Integrating ESG principles into business operations provides several additional advantages. Companies can significantly lower operational costs by optimizing energy efficiency, switching to clean energy, advancing waste management practices, and improving supply chain sustainability. These practices can also provide a buffer against unpredictable swings in resource prices and availability. Furthermore, adopting ESG practices can help mitigate risks and boost organizational resilience, enabling businesses to withstand economic downturns, regulatory changes, and environmental disasters more effectively.
Finally, companies proactively adopting ESG standards are better positioned to comply with a growing array of environmental and social regulations. This approach not only minimizes the risk of penalties and legal issues but also aligns companies with best practices in corporate governance. Collectively, these benefits demonstrate that adopting ESG principles is not just about “doing good” or “going green”—it’s a pivotal part of driving enduring business success.
The financial imperative is clear: In a recent IBM study, 76% of business leaders said ESG is a top priority for their business, and 72% approach it as a revenue driver rather than a cost burden.
ESG regulatory momentum
Compliance is another significant motivator for businesses to integrate ESG practices. Over 5,000 climate laws and policies and more than 3,000 ESG reporting requirements shape how companies must disclose sustainability matters. The EU is at the forefront of enforcing transparency through rules such as the Corporate Sustainability Reporting Directive (CSRD). And most major economies, including the U.S., have established ESG regulations that are not likely to change with political shifts. These include laws governing environmental issues like toxic substances, social concerns like labor practices and data security, and governance aspects like CEO pay and anti-corruption measures.
Despite U.S. federal inconsistencies, there is a notable push toward ambitious ESG standards at the state level. Many states are implementing policies such as net-zero emissions goals and carbon taxes, as well as laws around climate disclosures, anti-greenwashing, e-waste, and pay transparency. Companies operating within these states will need to align with these evolving requirements, regardless of the prevailing federal administration.
Global trade agreements require ESG compliance
Trade agreements like the United States-Mexico-Canada Agreement (USMCA) and Peru Trade Promotion Agreement (PTPA) enforce stringent ESG standards that companies must adhere to. This often includes strong labor and environmental protections. Compliance with these standards helps businesses secure tariff reductions and avoid penalties, reinforcing the global momentum toward enhanced ESG regulatory practices.
Elevate your ESG advantage with Aquent
Research consistently shows that ESG practices create real business value irrespective of political headwinds or policy changes. Companies with comprehensive ESG strategies report better financial performance, with documented improvements in operational efficiency, risk management, and stakeholder relationships. Data shows that these organizations achieve higher profit margins, better access to capital, and enhanced market opportunities while building resilience against emerging challenges.
With Aquent’s deep knowledge of evolving ESG regulations and reporting requirements, we can help your business meet compliance challenges in an ever-changing policy landscape. Tap into our pool of sustainability experts to build a robust ESG strategy that not only meets but exceeds global disclosure standards and stakeholder expectations, setting your business apart as a sustainable leader.
Looking to bolster your sustainability efforts? Aquent Sustainability is here to help. Whether you're building an in-house Sustainability Team or need an expert to advise on best practices, our sustainability recruitment and consulting services help companies grow their impact. Get in touch.
About the authors
Julie Yamamoto is a sustainability, Climate & Tech Content Strategist. She has over 20 years of global experience creating ESG, B2B tech, and environmental communications for multiple sectors. Her work has been featured in leading platforms, including Forbes, TechTarget, GreenBiz, and American Forests, as well as in numerous enterprise and nonprofit digital channels. In previous roles, she led content marketing for Cloverly, OneTrust’s ESG & Sustainability Cloud, and the IBM Center for Applied Insights. A trained Climate Reality leader, Julie has driven sustainability initiatives such as IBM AI for Social Good (Environment), Watson Green Advisor, Forests for the Earth, and data science for conservation efforts. She holds a Master of Science in Marketing Management from Nanzan University and a Bachelor’s in Business Administration from Oglethorpe University.
Jody Mousseau is currently VP of Sustainability Development and Co-Chair of the DEIB Council at Aquent. She has over twenty-five years of combined management consulting, client relationship management, and sales leadership experience and a strong passion for sustainable living and social justice. Jody joined Aquent in 2015 in a business development role and subsequently also worked on the recruiting side of the business. Her goals include creating meaningful relationships with clients and colleagues, creating safe and inclusive spaces for all, and normalizing diversity and sustainability in life every day.
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