ESG: The Hidden Reason Why So Many Companies Are Going Woke

While woke marketing messaging may be a nuisance for conservatives now, the forces driving it are much more sinister.

Whereas companies used to be largely politically neutral, focused only on selling products and services, in recent years we have seen an outright explosion of companies issuing statements on politically contentious topics. Political views on racial issues, LGBTQ issues, and other topics that have Americans strongly divided are often baked into marketing messaging and corporate decisions. Whereas this turn of corporate culture may seem totally organic, there is growing evidence that a sinister, top-down pressure is pushing companies to “go woke.” Rather than simply reflecting the views of politically left-wing marketing employees, these choices may have their roots in something known as “ESG scores.”

Companies have transformed from politically neutral providers of goods and services to advocates for so-called social justice causes in ways that typically align with left-wing thought. Following the death of George Floyd, many companies issued statements on policing and racial issues. Corporations now routinely turn their logos rainbow to signify support for LGBT Pride Month in June. And a great singular example of this is the viral, feminist 2019 Gillette razor ad that framed normal male behaviors — such as rough-and-tumble play and approaching and flirting with women — as “toxic” behaviors in need of societal correction. Gillette, which wants to sell razors to men, seemed to be roundly condemning its core customer base. Instead of just selling razors, Gillette deemed it more important to reflect a left-wing view of social issues in its advertising. We see this again and again in corporate messaging today. Why?

It’s easy to think that companies are going woke organically — that socially progressive employees themselves are driving the change. But it turns out there is also top-down pressure for companies to craft their enterprises in ways that align with left-wing cultural and policy goals. 

ESG stands for “environmental, social governance.” According to Global Banking and Finance Review, ESG is “an investment approach that assesses investment outcomes based on social goals in three areas: (1) environmental, (2) social issues, and (3) corporate governance.” While ESG criteria is not yet fully standardized, a corporation that does not merit a “positive” ESG score may be excluded from capital, loans, and other financial resources. And because ESG scores use criteria that align with left-wing thought on social, environmental, and policy issues, we see a lot of corporations “going woke.”

Taken to their logical end, ESG scores are a way to weaponize the financial industry, using it to strong-arm companies into advancing specific societal and environmental agendas. Multinational corporations like Disney and Proctor and Gamble now have an incentive to act counter to what their customers want in an effort to improve their ESG score. As a response to investors, corporations will push an agenda that moves the Overton Window to the left and advances left-wing causes. ESG scores have been fully embraced by the World Economic Forum, which has called the reporting of such scores ​​”increasingly essential — and even required.”

A 2022 survey of 300 companies found that 61% have taken a public stance on “racial equality” since 2020; 44% on “LGBTQ rights,” and 39% on “gender equality,” among other left-wing social justice causes. This is why politics in the U.S. now feels so totalizing. Whereas we used to be able to purchase a soda in peace, now your Coca-Cola comes with a side of in-your-face marketing messages about the corporation’s stance on contentious political and cultural topics. Some corporations, such as McDonald’s, have pushed back against political statements in corporate messaging, but the overwhelming majority of corporations are now taking social stances in the culture war.

As it turns out, companies are also being tracked on what they say about social justice and political issues, with financial institutions issuing decisions based on their compliance. Instead of looking at how profitable a company is, its business model, and other traditional metrics, ESG scores consider whether the company advances social justice causes and policy agendas that typically align with left-wing thought. 

With the financial industry issuing political compliance scores that encroach on the corporate space, there is also the fear that such scores could one day be extended to everyday people. With ESG scores being used to determine the financial future of companies, banks could one day make decisions about individuals based on their political stances and lifestyles — what you have said or not said about social justice issues, your personal carbon footprint, your social media presence, and more could impact whether you are allowed a business loan, a car loan, or a mortgage. It’s all speculation of course, but communist China has shown us that social credit scores are entirely within the realm of modern possibility — and ESG scores are just one step on the path toward their acceptance.

ESG scores do not allow room for dissent from a particular vision of society. Those who align with the left’s view on social issues — big questions like what policing ought to look like, the role of women and men in society, meritocracy versus affirmative action, gun rights and gun control, standards of behavior in media, or even abortion — will probably not be too worried about ESG scores, or will even see them as a good way to push companies in what they see as a positive direction. But those who dissent from the left’s view on these issues and hold very different beliefs about the way to create prosperous societies will clearly see the trouble with ESG scores ahead. 

It’s not necessarily bad for companies to think about the impact of their actions outside of the products or services they provide. It is bad when they are not free to make those decisions themselves, and when a top-down entity enforces for them what it means to be socially “good.” Consider the recent split between companies who believe they are engaging in social good when they fund their female employees’ abortion travel, versus those who believe that this constitutes a social evil. If ESG scores one day take into consideration a company’s stance on abortion, entities that refuse to fund an employee’s abortion travel out of moral opposition could be considered unfit for financial services or investment.

Downstream of ESG scores is the totalizing control of speech and thought. If individuals or companies must publicly issue support for left-wing ideas in order to operate in a marketplace, it’s the end of free speech and thought.

Taken to its totalizing end, ESG scores could usher in a one-party state — not via voting or force, but via slow cultural changes to our financial system that make it impossible to operate in the marketplace as a person or company that has traditional or dissenting beliefs. We have already seen financial institutions punish people for their political beliefs, so it’s not far-off to imagine the scale of the ESG threat growing in this way. While woke marketing messaging may be a nuisance for conservatives now, the forces driving it could one day spell the total end of freedom.