You can't cancel sustainability: A corporate perspective

In my previous article I wrote about governments "cancelling Sustainability". But what about companies?

Repeated messages I see resonating across media and leadership networks are:

• Sustainability teams are being cut
• Chief Sustainability Officers are disappearing or becoming less prominent
• Sustainability consultancy work is reducing
• Companies are Greenhushing and talking less about Sustainability
• Climate and Sustainability targets are being reconsidered
• Sustainable businesses, investments and products are being discontinued or sold
• AI has replaced Sustainability as the new corporate hype

And there are plenty of big names to prove the point.

BP didn't just reduce its renewable ambitions. It rolled back several of its 2030 climate ambitions, reduced transition investment and shifted capital back towards oil & gas.

Shell has also stepped back from parts of renewables. Interestingly, when Shell sold its European onshore renewables business in 2026, the assets didn't disappear. TotalEnergies bought the approximately 4 GW portfolio. One major oil company is reducing its exposure whilst another is increasing theirs.

Meanwhile oil & gas companies aren't just surviving. They're booking record profits. Following the Strait of Hormuz disruption and oil price increases, ExxonMobil and Chevron together made around $26.5 billion profit in Q2 2026.

So let's not pretend Sustainability is currently winning every market signal.

But again let me get this straight: You can cancel a Sustainability team. You can't cancel Sustainability.

So what exactly is disappearing?

It would be easy to look at disappearing CSOs, quieter companies and reduced consultancy work and conclude companies simply aren't taking Sustainability seriously anymore. Yet look underneath the communications and the picture gets more complicated.

By the end of 2025, 9,764 companies had validated Science Based Targets, an increase of 40% in one year. Validated Net Zero targets grew 61%.

And it isn't only climate. TNFD provides companies with a framework to assess and disclose their dependencies and impacts on nature. It only launched its final recommendations in September 2023, yet by the end of 2025 more than 700 organisations had already committed to TNFD aligned reporting.

EcoVadis is interesting for a different reason. Large companies use it to assess Sustainability performance in their supply chains, so it increasingly becomes part of procurement and doing business. Its network grew to around 175,000 rated companies in 2025, adding more than 25,000 in a year.

ISO 14001 is different again. It isn't a target or rating but a management system used to actually manage environmental impacts in operations. More than 670,000 organisations are certified globally and the standard was updated again in 2026. ISO 50001 similarly embeds Energy Management into normal business management and its adoption has grown significantly over the last decade.

Then look at China. Whilst we debate in the West whether ESG is dead, China added another 2,038 national Green Factories for 2025, bringing its total to 8,336.

So which is it? Companies are retreating from Sustainability or companies are embedding more Sustainability systems?

Both.

Maybe part of what is disappearing is actually the Sustainability label

We see Sustainable Product ranges disappearing too, but we should be careful what conclusion we draw from that. H&M removed its Conscious and Conscious Choice labels following scrutiny over whether the Sustainability claims were sufficiently clear and substantiated.

Volkswagen's famous clean diesel scandal didn't happen because consumers didn't want lower emission vehicles. The environmental performance being sold to customers wasn't actually being delivered.

Other Sustainable Products simply haven't worked well enough, cost too much or required too much behavioural change. Fast fashion after all is still fashionable. Temu and Shein became global giants.

And Sustainability companies themselves can fail. Here in the Netherlands, seven plastic recyclers went bankrupt during a disastrous 2024 for the sector. The underlying problem was painfully commercial: amongst other pressures, recycled plastics struggled to compete with cheaper virgin material.

Something being environmentally better doesn't automatically make it commercially sustainable.

Maybe the mistake was expecting Sustainability itself to be the product

I have spent much of my career around manufacturing, engineering, operations and Sustainability. When you stand on a factory floor nobody really gets excited because you tell them to reduce energy consumption to improve an ESG rating. Tell them we can reduce energy consumption, save money, improve the process and reduce emissions at the same time and suddenly you have a different conversation.

The same applies to products.

Customers don't necessarily want a Sustainable washing machine. They want one that performs well, costs less to operate, uses less electricity and water and lasts longer. Refurbished products work particularly well when customers get quality products for less money. Recycling becomes attractive when it reduces raw material costs or dependency. Energy efficiency becomes interesting when electricity is expensive.

Perhaps the most successful Sustainable Product is eventually just called the better product.

But companies can still lose by missing the transition

This reminds me of the Innovator's Dilemma.

Successful companies don't always lose because they make stupid decisions. Sometimes they lose because they continue making completely rational decisions based on their existing customers, assets and most profitable products whilst something new develops around them.

Look at automotive. More than 20 million electric cars were sold in 2025, around one in four cars sold globally, with China at the centre of the transition.

Traditional manufacturers meanwhile face major restructuring whilst trying to compete with Chinese manufacturers that developed capabilities earlier.

That doesn't mean an internal combustion engine manufacturer should have stopped making profitable cars ten years ago. Neither does it mean Shell is wrong and TotalEnergies is right for buying its renewable assets. We will find out.

The harder question is: at what point does maximising the profitability of your existing business reduce your ability to compete in whatever comes next?

AI brings another contradiction

AI has clearly replaced Sustainability as one of the biggest corporate topics, yet AI is driving enormous requirements for electricity, grid connections, cooling, water and infrastructure. Tech companies are even investing in or contracting gas generation to secure the power they need.

Grid congestion is increasingly creating a "Bring Your Own Power" reality. That can favour gas, but equally solar, batteries, efficiency and demand response that can be deployed locally.

AI may have replaced Sustainability as the corporate hype. Ironically it has made energy efficiency, water, grid capacity and resilient infrastructure even more strategically important.

And eventually all of this arrives in the P&L

Renewable PPAs aren't only about carbon. They can provide longer term electricity price certainty.

Efficiency reduces operating costs.

Recycling and recovery can reduce material purchases, waste costs and exposure to resource shortages.

Water efficiency becomes business continuity when there isn't enough water.

Flooding, drought, low river levels, extreme heat and wildfires become production downtime, logistics disruption and higher costs.

Insurers might actually be the canary in the coal mine because they don't just publish Climate Risk reports. When the risk changes they put a price on it, increase the premium, restrict coverage or simply refuse to insure it.

Pollution is even more obvious. In August 2026 more than $2.5 billion of New Jersey PFAS settlements involving 3M, DuPont, Chemours and Corteva received court approval.

A regulation can disappear in four years. A chemical released into groundwater doesn't.

Government requirements aren't static either. Whilst some Sustainability reporting requirements are being simplified, requirements around carbon borders, deforestation, packaging, product design and environmental claims are increasing. Fossil fuels also continue receiving significant government support globally, but this support itself is under increasing scrutiny.

Today's economics therefore aren't necessarily tomorrow's economics.

And this is perhaps where markets can give us a false sense of security

A company can make record profits whilst creating long term Sustainability risks. Consumers can keep buying fast fashion. Investors can continue rewarding the company. None of that necessarily means the underlying risk doesn't exist. It may simply mean the consequence isn't fully reflected in today's price.

We have seen versions of this before. The Credit Crunch demonstrated that a risk being tolerated by the market isn't the same as the risk not existing. Risks can remain dispersed and mispriced for years and then be repriced remarkably quickly.

The Network for Greening the Financial System even models a "Sudden Wake-up Call" climate scenario where changing expectations lead to rapid repricing, stranded assets and financial stress.

Does this mean every Sustainability project deserves investment? Absolutely not.

Some targets weren't credible. Some Sustainable Products didn't sell. Some didn't perform. Some claims couldn't stand up to scrutiny. Some renewable investments generated poor returns. Some Sustainability teams became detached from Operations, Finance and Commercial. Some consultants probably generated more reports than results. Some companies certainly talked much more than they delivered.

Maybe some of that needed to disappear.

Sustainability by definition is about sustaining value. An initiative that continuously destroys value without creating something elsewhere isn't particularly sustainable either.

Maybe what we are witnessing therefore isn't the death of Corporate Sustainability but its reality check.

Companies can stop saying ESG. They can cut the Sustainability team. They can remove the CSO. They can abandon a target, sell a Sustainable business or discontinue a Sustainable Product.

But they will still buy energy and materials. They will still consume water. They will still generate waste. They will still rely on suppliers and customers. They will still insure factories, manage risks and make investments that need to create value for decades. They will still carry the consequences when they pollute.

The Sustainability department is not Sustainability.

The challenge isn't predicting exactly when markets will recognise every Sustainability risk or opportunity. It is avoiding being the company whose business model only works for as long as they don't.

You can't cancel Sustainability.

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