From diversity to debanking: Is ESG bad for business?

Battle of Ideas festival 2023, Saturday 28 October, Church House, London


In July, NatWest’s CEO Alison Rose became the latest casualty of the turn to environmental, social and corporate governance (ESG) in big business. Rose resigned after the furore over the closure of Nigel Farage’s Coutts account, in part because his political views did not ‘align’ with the company’s values. From Nike annoying women by embracing trans ‘influencer’ Dylan Mulvaney to Gillette annoying men by piggy-backing on the #MeToo movement, there have been numerous high-profile corporate mis-steps in the name of projecting a ‘progressive’ image.

The traditional image of a big business is one of an organisation single-mindedly focused on generating profits for shareholders. But in recent years, there has been a drive to introduce other aims into corporate practice and mission statements, from tackling climate change to promoting ethnic and gender diversity. Given the strong position of big corporations in society, changing the way they conduct business could be a powerful force for good, in the eyes of many.

But there have been concerns that the promotion of such values could be at odds with the views of customers. In April, the backlash against Bud Light’s use of Mulvaney in their advertising led to a boycott of Budweiser products and a decline in the company’s share price. Alissa Heinerscheid, Anheuser-Busch’s vice-president for marketing, had earlier declared that the brand needed to increase its ‘inclusivity’, but she was later reported to have been fired by the company.

What is the best role for big firms in improving society? Should they focus solely on producing the best products and services at the keenest prices? Or given their influence, should they be promoting social change, too? Is the turn to ESG, as many claim, merely ‘wokewashing’ or have top executives really bought into pursuing these aims? What does all this mean for profitability, productivity and material progress more generally – and for the future of companies themselves?

Luke Johnson
entrepreneur, Gail’s Bakery

Catherine McBride
economist; fellow, Centre for Brexit Policy

Lesley Smith
corporate reputation and communications consultant; former director, global corporate affairs, Revolut; former public policy director, Amazon

Martin Summers
director, Flint Global; advisor on ESG policy

Dr Joanna Williams
founder and director, Cieo; author, How Woke Won and Women vs Feminism

Hilary Salt FIA, FPMI, FRSA
actuary; founder, First Actuarial