A majority (80%) of sustainability executives say their companies are adjusting their environmental, social & governance (ESG) strategies in response to the new administration, according to a new survey by The Conference Board.
The survey reveals significant policy changes are reshaping how many companies approach sustainability. The most common change is reframing communications: 52% of executives report reworking their sustainability messaging, including moving away from the term “ESG.” Tariffs also pose a challenge, with 66% saying they will hinder progress on achieving sustainability goals. Almost half (45%) say they will delay investments in sustainable operations.
The survey, which included 125 sustainability executives from large U.S. and multinational companies, also captures how ESG backlash is evolving: 90% believe it will persist—or even intensify—over the next few years. That’s a rise from 63% just two years ago. The top targets of backlash are climate-related commitments, such as net-zero goals, and ESG-related language.
When asked who is driving the backlash, surveyed executives now point to federal policymakers. It marks a shift from two years ago, when activists and advocacy groups topped the list.
“Recent policy shifts have turned up the heat on ESG, which had already been facing mounting scrutiny,” said Andrew Jones, author of the report and Principal Researcher at The Conference Board. “In most cases, the backlash hasn’t made companies back down, but rather pushed them to recalibrate how they approach, communicate, and integrate these issues into their businesses.”
ESG Backlash Topics
The biggest backlash targets in 2025 areESG language and climate goals, according to the survey.
- 50% of executives expect net-zero goals or climate targets to be primary flashpoints for backlash
- 34% anticipate backlash tied to use of ESG language or branding
Tariff turbulence is putting new pressure on corporate sustainability strategies.
- 66% of executives are concerned that tariffs or future trade restrictions will impede sustainability goals
- 45% are concerned that trade uncertainty will delay investments in sustainable operations
- 42% anticipate cost pressures on sustainable materials or inputs
The survey revealed that companies are adjusting their strategies by reframing language and moving away from the term “ESG.”
- 52% of executives say their companies are narrowing or reframing communications, including moving away from the term “ESG”
- 48% are increasing legal and risk review
- 43% are enhancing focus on business ROI and shareholder value of ESG-related initiatives
Sources Of ESG Backlash
What and who are the sources of this latest backlash? Activists take a backseat, and federal policymakers are now the leading source of ESG opposition, according to The Conference Board.
- Federal policymakers are the top agitator: 78% of executives say U.S. federal policymakers and regulators will be the most significant drivers of ESG backlash. That’s up from 43% who said the same about this group’s impact over the last two years.
- Activists are no longer the main source of pressure: 51% cite activist groups, up from 48%. Over the last two years, respondents had cited activists as the leading source of backlash.
The survey reveals that regulatory fragmentation is now the top challenge for corporate sustainability efforts.
- 49% of executives cite widening ESG regulatory and reporting gaps (state-federal, state-state, U.S.-international) as the top concern for their sustainability strategies
- 46% highlight increased scrutiny on DEI practices
- 39% cite rollbacks of environmental regulations
Watch this video from The Conference Board to find out what’s next for corporate sustainability.
What’s Ahead For ESG Sentiment?
Corporate leaders are braced for a prolonged anti-ESG wave. According to the survey, 90% of executives expect anti-ESG sentiment to either increase or persist over the next two years. This is much higher than in 2023, when 61% of executives expected backlash to increase or persist over the next two years.
“Corporate ESG strategies are shifting into a more fragmented, risk-oriented phase,” commented Jeff Hoffman, Interim Governance & Sustainability Center Leader at The Conference Board. “Global regulators and several U.S. states are advancing new standards, even as federal action slows and internal corporate momentum stabilizes. Corporate leaders must manage diverging and often conflicting sustainability expectations from employees, consumers, investors, and regulators with greater precision and pragmatism.”