Are Corporations Retreating on Sustainability? Adapting to a Quieter ESG Landscape
A Thought Leadership piece by Maria Grazia Cafagna (Director, ESG & Regulatory Solutions, CCH Tagetik, Wolters Kluwer)
Over the last few months, it could be argued that sustainability appears to have shifted from a boardroom to a backroom issue. The ESG backlash has been fueled by recent policy changes, as well as the European Commission’s Omnibus Simplification Proposal.
But what’s the reality? Are companies truly rolling back their sustainability efforts? And what should you do in this new phase to continue building long-term resilience?
Companies still recognize the value of sustainability
As of 2025, 87% of US companies have maintained or increased their sustainability investments and 88% of global companies still view sustainability as a long-term value creation opportunity.
But, compared to a year ago, companies are staying quiet about their targets even while working steadily toward their sustainability goals. This trend, known as “greenhushing” has gained momentum.
Why companies should continue to prioritize ESG
If you’re weighing whether to continue your sustainability efforts or scale them back, consider that:
Regulation delays are an opportunity to get ahead
Many sustainability and finance teams welcome the extra time to treat materiality assessments and reporting as strategic tools that align sustainability with business goals, not just tick-box exercises. As one sustainability manager interviewed by Verdantix stated, “We have already made external commitments to reduce our waste, water and energy consumption. The Omnibus Proposal does not change anything, except that we now have more time to focus on data quality.”
Regulations are continuing on the global stage
While the retreat on sustainability regulations is prominent in some parts of the world, other leaders and governments continue on. Despite the Omnibus proposal, the EU's suite of robust sustainability legislation has established the continent as the global driver of sustainability. ESG rollback may slow momentum, but it won’t derail the global sustainability movement.
Competitors are forging ahead
Despite a few high-profile companies scaling back their sustainability initiatives, most of the corporate world is quietly forging ahead. Research shows that by mid-2025, nearly 11,000 companies had validated science-based targets or had committed to set them. Companies with both near-term and net-zero targets surged by 227% across the reporting period since 2023.
3 ways to revisit climate targets in this moment of greenhushing
We recommend that organizations use this sustainability pullback to revisit targets, systems, and stakeholder engagement to ground climate transition plans in measurable success. Here’s how:
1. Tie sustainability targets into business value
Sustainability success translates directly into profitability. Sustainable products command a 26.6% price premium and see 2.3x higher sales than conventional ones. Sustainability targets should benefit the world and deliver tangible company value through operational efficiency, employee morale, and the bottom line.
2. Move from ambitious to specific, financially grounded targets
Financial modeling, capital planning, and scenario planning are as essential for ESG as they are for developing the capital budget. For example, the most effective climate transition plans include multiple decarbonization pathways and can account for evolving external scenarios such as grid decarbonization, policy changes, and technology adoption.
3. Involve the office CFO
CFO buy-in is essential for climate targets that will go the distance. The 2025 Verdantix global corporate survey shows that 77% of sustainability leaders view the CFO as a leading or significant figure in funding sustainability strategies, third only to the CEO and CSO. With investor-grade sustainability data now expected, sustainability teams should turn to CFOs and finance teams for support.
The time to revisit climate targets is now
Corporate sustainability may be hushed right now but it isn’t going away. In the long run, the drive toward a healthier planet and ethical business practices will persist.
Join CCH® Tagetik and CDP for an upcoming webinar exploring the evolving sustainability landscape. Discover how finance teams can drive real business value through impactful ESG strategies.