Is ESG Dead? Or Just in the Middle of a Reinvention?

Daniella Foster

Daniella Foster, Executive Board Member, SVP and Global Head of Public Affairs, Science & Sustainability for Bayer’s Consumer Health Division and Board Chair at the UN Global Compact Network USA, calls for a pivot away from the "ESG" battles and to focus instead on sustainable business and the sustainability of your business.


Woke capitalism. Virtue Signaling. Just a buzzword without real substance. This is some of the language I’m sure you’ve also seen around the term “ESG,” as a part of the ongoing conversation on whether ESG is dead.


Instead, I’m a fan of Fortune’s take: ESG is dead. Long live E, S, and G. It’s time to pivot. Now!


For those, like me, who have been in this industry for a while, we know that every so often we go through a reinvention. Corporate philanthropy, corporate citizenship, corporate social responsibility, sustainability . . .  the list could go on. What’s evident by these changes is that we're adapting to the business climate, with the latest incarnation moving sustainability from a nice-to-have to a business mandate.


And now we’re in the middle of another reinvention, and I think that’s a very good thing. One of the reasons “ESG” has been highly politicized is many people equate ESG with reporting and “check-the-box” management. It’s a reporting and investor acronym. It has a role, but it’s not everything. The intent – a focus on the environment, human rights, and governance – still makes good business sense and should be high on the corporate agenda. Ninety-two percent of CEOs say they are continuing their ESG programs, but most are modifying their approach. The next evolution will be focused on sustainable business AND the sustainability of your business; empowering companies to create a sustainable business model that anticipates people’s needs, helps solve world issues AND makes a profit. When this reinvention is successful, here are some of the ways I think a sustainable company will operate 10 years from now:



Aligning Lobbying Efforts with Sustainability Commitments


I participated in a COP28 session on corporate accountability and a representative from the government of Norway asked a great question: how do you know that your company is doing the right thing? One of his criteria was looking at a company’s lobbying efforts and seeing if they are congruent with their climate and human rights position. A November 2023 study by InfluenceMap showed 58% of ~300 Forbes 2,000 companies reviewed were found to be at risk of “net zero greenwash” due to their policy engagement. These are companies that have announced net zero commitments, but are not adequately supporting policy to deliver the Paris Agreement. For instance, the report calls out several gas and energy companies for making net zero commitments, but with contrarian lobbying actions such as advocating for oil and gas expansion, opposing proposed power plant rules, fossil fuel phase-outs, and climate policies.


To enable stakeholder trust and ultimately a better, more world-positive business, companies will need to align what they stand for and act upon in the public sphere.



Investment in the Future of your Business


Instead of focusing on “checking the box,” the future is about investing in the sustainability of your business, which will be fueled by being a sustainable one. Let me unpack this thought. At COP28, much of the focus was on the path to phasing out fossil fuels, but there was also a compelling conversation about the critical need to build climate resilient communities. These both can serve as business opportunities that help the world at the same time. 


Companies should think of sustainability as a business accelerator, using existing strengths and core competencies as a guide. For instance, food and agriculture contributes 25% of greenhouse gas emissions worldwide, and on the flipside, also is negatively impacted by extreme weather like droughts, floods, and heat leading to food insecurity. My company, Bayer, is a leader in agriculture, these challenges are at the core of our research and development strategy — driving us to create value for both our shareholders and the planet. We’re developing ways to mitigate the adverse impacts, such as reducing the impact of our crop protection products by 30% by 2030 (as of last year, we have gotten to 14%).  In addition, we’re developing new technologies that work with the changes in climate to help farmers improve their yields and minimize their environmental impacts. One example is direct-seeded rice, which moves away from the traditional growing method of flooding a paddy. This approach improves water use per kilogram of crop by 25% and reduces on-field greenhouse gasses per kilogram of crop produced in our key markets by 30%. Innovations like these also improve people’s livelihoods – one of the main audiences is smallholder farmers and innovations like these improve their productivity and the quality of their yields, in turn helping them earn more money.


Other companies are doing this today as well, but I think more companies need to do the hard work to embed sustainability into their business model to create new opportunities to propel future growth.



Using Sustainability to Drive Vision


One reason companies fail is they don’t evolve with people’s needs. And what could be a bigger need than helping people and the planet adapt to climate change and build resilience, given the impact it is and will continue to have on our livelihoods. Climate change is impacting everything from our health to our food, to our homes, and to our rights.


Think about your audience. What do you they need today and how will that evolve in the future (when climate change is likely causing even more damage)? Is your vision aligned with this? These questions sound simple, but are good ones to go back to, to ensure you are on track to be a sustainable business.


A good place to start is seeing what concerns are at the top of the list for governments and policy makers. During COP28, 200+ countries signed a historic agreement to transition away from fossil fuels; 120+ countries signed the health and climate declaration, 100+ countries endorsed tripling reliance on renewable energy sources . . . Companies that succeed in the future will marry these needs with their business core competencies to ensure the sustainability of their business moving forward.



Don’t Wait!


While I framed this blog as a hypothesis on how sustainable companies will operate 10 years from now, there’s no need to wait 10 years to evolve. Whether we call it ESG, Sustainable Business, Impact Generation, or something else, it doesn’t matter. What matters is that sustainability can and should play a central role in how companies operate. As someone whose job it has been to embed sustainability into the business strategies of both Bayer and Hilton, believe me, I know the changes I’ve outlined take hard work to achieve. But I also truly believe – and have seen — this is a key way to help business generate impact and value for shareholders, consumers, governments, and the world.

About the Author:

Daniella Foster
Executive Board Member, SVP and Global Head of Public Affairs, Science & Sustainability for Bayer’s Consumer Health Division
Board Chair, UN Global Compact Network USA


Photo: Andrey Popov, ©️Bayer


Read perspectives from the ISSP blog

Paper cut-out figures holding hands in a chain against a dark blue background.
By Elizabeth Dinschel, December 18, 2025 December 18, 2025
Elizabeth Dinschel, MA, MBA, is the Executive Director of ISSP Earlier this month, we hosted our first global ISSP Town Hall since I stepped into the role of Executive Director. I logged off that call energized, humbled, and deeply grateful for the honesty, generosity, and care that our members brought into the space. This Town Hall was never meant to be a one-way update. It was designed as a listening session — a chance for ISSP leadership and staff to hear directly from sustainability professionals across regions, sectors, and career stages. And you delivered. What follows are a few reflections on what I heard, what we learned, and where we’re headed next together. Why We Called This Town Hall ISSP has gone through a period of transition — new leadership, new staff, and a renewed focus on modernizing how we serve a truly global membership. Change can be energizing, but it can also create moments of uncertainty and disconnection. We knew we needed to pause, gather our community, and listen with intention. The Town Hall brought together members from multiple continents, industries, and disciplines. Sustainability practitioners, consultants, engineers, communicators, policy professionals, and career-transitioners all showed up with thoughtful questions and candid feedback. One thing was immediately clear: this community cares deeply about its work, about each other, and about ISSP’s role in supporting sustainability professionals at a challenging moment for the field.
Can sustainability be saved by tackling loneliness, not just CO₂ emissions?
By Raz Godelnik, Associate Professor November 20, 2025
Raz Godelnik is an Associate Professor of Strategic Design and Management at Parsons School of Design — The New School. He is the author of Rethinking Corporate Sustainability in the Era of Climate Crisis . You can follow him on LinkedIn .  Can sustainability be saved by tackling loneliness, not just CO₂ emissions? Earlier this month, I stopped at Sunshine Coffee in Laramie, Wyoming, on our way to Yellowstone Park. What brought me there was the fact that it’s a zero-waste coffee shop, with no single-use consumer items. In other words, there are no disposable cups — not for customers dining in, and not even for those who want their coffee to go, like I did. Instead, you can either bring your own reusable cup or get your drink in a glass jar for $1, which is refunded on your next order when you return it (or you can simply keep it, as I did). At first, I was excited about the zero-waste coffee shop concept, wondering what it would take for Starbucks and other coffee chains to adopt it and eliminate the waste that has become an integral part of our coffee (and other drinks) consumption. But as I waited for my coffee, I began to notice something else — something that had little to do with waste and everything to do with people. As I looked around, I noticed their stickers. Beneath the logo, it read: Zero waste. Community space . Suddenly it clicked — this coffee shop isn’t just about eliminating waste; it’s about creating a place where people feel connected. As owner and founder of Sunshine Coffee, Megan Johnson, explained in an interview with This is Laramie : “I wanted to bring sustainable values to Wyoming as well as build a business that serves the community.” That got me thinking about how the second part — serving the community — is integral to the first. After all, in a world where loneliness — a key barrier to people’s well-being — is on the rise, shouldn’t creating spaces for connection be just as central to sustainability as going zero waste?
By Nicole Cacal, MSc, October 30, 2025
Nicole Cacal, MSc, is Executive Director of the TRUE Initiative in Hawaii and serves as Vice President on the Governing Board of ISSP. In our October blog, she challenges the prevailing narrative around AI's environmental impact, arguing that strategic deployment can transform AI from an environmental burden into a driver of recursive sustainability. Drawing on her background in strategic design and technology management, she presents emerging pathways for responsible AI adoption that balance societal benefit against environmental risk. Toward Appropriate and Responsible AI: Pathways to Sustainable Adoption and Infrastructure Nicole Cacal · October 27, 2025 Whenever I give an AI presentation or offer advice on AI adoption, whether to business owners, C-level executives, or sustainability professionals, one concern surfaces time and time again, especially here in Hawaii: the environmental tension. People want to explore AI's potential, but they're acutely aware of the energy consumption, the water usage, the carbon footprint. It's become almost a reflex: mention AI, and someone immediately raises the environmental cost. I get it. The data centers, the training runs, and the resource demands. They're real and they're significant. But here's what I've come to believe: if we shift the narrative from focusing solely on AI's detriment to the environment and instead ask how much good it can create, what role we can play in driving data centers to go greener, and how we can generate recursive sustainability, we unlock better questions. We start thinking forward rather than just defensively. As sustainability professionals, our job isn't to reject technology wholesale. It's to shape its evolution. And right now, we have an opportunity to influence how AI develops and deploys in ways that align with planetary boundaries and social equity. But to do that, we need to move beyond binary thinking. Right-Sizing AI: Why Bigger Isn't Always Better One of the most overlooked levers we have for sustainable AI is also one of the simplest: choosing the right model for the job. The AI industry has been caught in a "bigger is better" arms race for years now. Every new model release touts more parameters, more capabilities, more everything. And sure, these massive general-purpose models are impressive. But they've created a dangerous assumption: that every task requires maximum firepower. This is where my strategic design training from Parsons kicks in. Good design isn't about having the biggest toolkit. It's about matching the tool to the task. It's about elegance through constraint. The same principle applies to AI deployment. The emerging concept of "Small is Sufficient " is gaining traction for good reason. Research shows that selecting smaller, purpose-fit AI models for specific tasks can achieve nearly the same accuracy as their larger counterparts while reducing global energy demand by up to 28% . Twenty-eight percent. That's not marginal; that's transformational. Think about what your organization actually needs. Are you processing customer service inquiries? Analyzing spreadsheet data? Generating product descriptions? Most of these tasks don't require a frontier model. A fine-tuned, task-specific model will do the job with a fraction of the computational overhead. The shift we need is cultural as much as technical. We need to move from asking "what's the most powerful AI we can deploy?" to "what's the most appropriate AI for this specific use case?" That question changes everything, from procurement decisions to vendor relationships, internal training, and infrastructure planning. AI as Infrastructure Manager: The Self-Optimizing Data Center Here's an irony that doesn't get enough attention: AI might be energy-intensive, but it's also one of our best tools for managing energy systems efficiently. When we only think of AI as a consumer of data center resources, we miss part of the story. AI can also be the conductor of efficiency, orchestrating complex systems in real-time to minimize waste and maximize renewable integration. Consider three optimization domains where AI is already making measurable impact: Cooling systems: Data centers generate enormous heat, and cooling accounts for a massive portion of their energy use. AI can continuously adjust cooling based on workload patterns, outside temperature, humidity, and dozens of other variables, optimizing in ways that static systems simply can't match. Workload scheduling: Not all computing tasks need to happen immediately. AI can intelligently schedule batch processing, model training, and background tasks for times when renewable energy is abundant or when grid demand is lowest. This isn't just theory. Companies are already doing this. Renewable energy integration: This one hits close to home in Hawaii, where we're working toward aggressive renewable energy targets but face unique challenges with grid stability and storage. AI-managed facilities can modulate demand in response to solar and wind availability, essentially turning data centers into flexible grid assets rather than inflexible burdens. When organizations approach their operations as integrated systems rather than collections of independent components, they achieve results that surprise even them. AI-orchestrated data centers represent this systems thinking at its most sophisticated. The technology optimizes itself recursively, reducing the footprint of AI through AI. That's the kind of elegant solution we should be scaling. Measuring What Matters: Beyond Energy to Net Benefit But here's the challenge: if we only measure AI's direct energy consumption, we miss the full picture. We need frameworks that capture both the operational cost and the systemic benefit. This is where life cycle assessment combined with comparative modeling becomes essential. We need to ask: compared to what? And over what timeframe? The sectoral success stories are compelling when you run the numbers: Building automation systems powered by AI are consistently achieving energy savings in the range of 20-30% across diverse building types. One documented case study of a commercial office building in the United States showed a 32% reduction in overall energy consumption with a 2.4-year return on investment (a $2.1 million system investment generating $875,000 in annual savings). In Stockholm, the SISAB school building portfolio achieved similar results with a two-year payback period. In precision agriculture, AI-driven irrigation and fertilizer application systems are cutting water consumption by 20% to as much as 50% and reducing chemical runoff, addressing both resource scarcity and ecosystem health. Waste management optimization is another powerful example. AI-powered sorting systems in recycling facilities dramatically improve material recovery rates while reducing contamination. The resource efficiency gains far exceed the AI system's energy footprint. These aren't marginal improvements. When properly deployed, targeted AI applications produce emissions savings and resource efficiencies that dwarf their own operational costs. That being said, given today's fossil fueled data center expansions, we may find that we have much further to go in making the environmental positives outweigh the negatives. But that's no reason to throw in the towel or to assume that these technologies cannot - over time - deliver more environmental benefits than downsides. It requires companies to demand more of their technology providers and deploy their systems sustainably when greener options become available. But (and this is crucial) these benefits only materialize when we pair the right AI with the right infrastructure and the right deployment strategy. Which brings us to governance. The Path Forward: Governance, Transparency, and Adaptive Thinking The sustainability community, including organizations like ISSP, is actively developing shared frameworks for assessing AI's net impact. These emerging approaches include system-level energy auditing, selective task deployment protocols, and strategies for minimizing "dark data" (the vast amounts of stored data that's never used but still requires energy to maintain). Multi-stakeholder governance initiatives are bringing together technologists, policymakers, environmental scientists, and business leaders to create adaptive standards. This isn't about creating rigid regulations that will be obsolete in two years. It's about establishing principles and processes that evolve with the technology. Those with a technology management background know that the most successful systems are those designed for adaptation. We need governance structures that can respond to new information, course-correct quickly, and remain grounded in measurable outcomes. Transparency is non-negotiable. Organizations deploying AI need to measure and report not just their energy consumption but their net impact. What problems are you solving? What resources are you saving? What would the alternative approach have cost? These aren't easy questions, but they're the right ones. As sustainability professionals, this is our arena. We have the frameworks: life cycle thinking, systems analysis, stakeholder engagement, and metrics development, to name a few. We need to apply these tools to AI with the same rigor we've applied to supply chains, built environments, and industrial processes. So here's my invitation: What are you seeing in your sector? How is your organization approaching the AI sustainability question? Are you finding innovative ways to ensure deployment is appropriate and responsible? Because ultimately, appropriate AI isn't about choosing between progress and sustainability. It's about insisting that progress is sustainable. It's about right-sizing models, optimizing infrastructure, measuring net benefit, and building governance systems worthy of the challenge. The technology itself is neutral. Our choices determine whether AI becomes a driver of sustainability or another extractive burden. Let's choose wisely.
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