Will ESG have an impact on politics as well?

Will ESG also shape Politics?

Paulo Dalla Nora Macedo

The Economist published a provocative piece on mob rule in its second edition of 2021, entitled “Madison’s Nightmare,” which closed with an enlightening warning by arguing that “The age of democratic naivety died on January 6.

At the core of the text is Alexis de Tocqueville’s formula to uphold democracy: Do not rely on the Constitution alone for the Herculean task of defending democracy; a country must have a self-reliant and educated population, alongside an elite that recognizes that its first duty is to educate the democracy. Will this suggestion resonate in the corporate world?

One piece of evidence of wider responsibility is that dozens of Republican Congress members voted against certifying the election, in line with the Capitol mob’s wishes, even after the invasion. Just recently, the Republican Party has declared that the event was a “legitimate political discourse.”

Predicting that the broader responsibility-seeking movement would occur, technology and social media companies blocked the president’s accounts, as well as many of the amplifying voices, on an app that was becoming a haven for extremists.

Companies like Marriott, Airbnb, and Dow Chemical announced they would suspend donations to the members of Congress who voted against the American election certification. Citibank, Goldman Sachs, and JPMorgan, among others, announced that they were suspending all donations while “reassessing internal financing policies.”

One of the biggest donors to political movements in the United States, billionaire Charles Koch, reopened discussion of responsibility for past conduct.

Along with his brother David, who died in 2019, he helped boost the Tea Party movement and the far-right wing of the Republican Party in the United States. He carried out a meaculpa in his most recent book, Believe in People.

While this was obvious, it did not prevent many companies from making statements supporting the president on several occasions, just as several CEOs had no qualms about posing for photos at White House events with Trump.

The investment to push the Trumpist agenda may have achieved positive returns in the short term, with the approval of a tax-cut package, but it will have a substantial negative cost in the long run, through the wounds it left on society.

In this process, the companies’ public statements and their leaders’ behaviors also need to be cross-checked against the corresponding ESG policy. Are they aligned, or is there a chimera scenario: the company as the political animal and the corporate being.

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