The ESG Threat

Politics and ideology have a tendency to seep into every corner of our lives. One of the most efficient ways it has done so lately is through Environmental, Social, and Governance criteria (ESG) increasingly used by business, investment houses, and government regulators. Growing out of the “stakeholder” model of business governance, ESG claims to have the benign goal of ensuring that investors and others can know which businesses are “contributing to the realization of goals over and above profit.” But as Samuel Gregg showed in the lead essay of Law & Liberty’s December forum, ESG in practice is at best incoherent and at worst “risks corroding our understanding of the nature and proper ends of commercial enterprises.”