Good morning.
The political backlash against ESG has clearly had its effect on business sustainability efforts, at least in the U.S. New corporate commitments to climate programs have slowed substantially, and the already committed are doing less to tout their efforts. Yet I continue to be impressed by the number of companies that have rebuilt corporate strategies around the climate challenge.
I spoke Friday with John Delaney, executive chairman of Forbright Bank, a Maryland-based bank that has put decarbonization at the core of its business. Delaney founded two successful financial firms before being elected to Congress in 2012 and then running for the Democratic presidential nomination in 2020, so he has a unique perspective on the interactions of business and government. I asked him how he thought business was responding to the political backlash against ESG.
“People weren’t very disciplined about this. A lot of businesses did it for hype and didn’t really define what their objectives were. That is really the problem with ESG. It is a term we don’t use.
“The last two years of politicization have in some ways been healthy because it is forcing people to defend the positions they are taking. They are being forced to make the business case. It is forcing a deconstruction of ESG. And E to me is the clearest business case you can make.
“The energy transition is hard. It will have winners and losers. It will have starts and stops. It is not going to unfold in a linear way. It’s messy. And we are going through that messiness.”
I made a similar argument Friday morning, at a sustainable business forum at NYU Stern, saying business had moved from greenwashing to a kind of woke whispering. Tensie Whelan, who runs the NYU Stern Center for Sustainable Business, presented some interesting research that supported the notion that progress continues, showing Fortune 100 companies had built up substantial ESG expertise on their boards over the last five years. Of the 100, 89 boards had ESG committees in 2023, compared to just 22 in 2018. And 43% of directors had relevant ESG credentials, up from just 29% in 2018.
By the way, Forbright Bank this morning will announce a $250,000 donation to the National Park Foundation, to support expansion of in-park EV charging infrastructure, wetland restoration, and other climate-friendly policies. You read it first here.
Other news below.
Alan Murray
@alansmurray
alan.murray@fortune.com
TOP NEWS
The last days of the Boeing whistleblower
John Barnett, a Boeing whistleblower, was found dead in a Holiday Inn parking lot on March 9, ahead of a deposition involving claims that the plane manufacturer unlawfully retaliated against Barnett for raising concerns about safety. Barnett was perhaps the most prominent Boeing whistleblower for highlighting safety and production issues with the 787 Dreamliner, like faulty oxygen masks. Barnett’s claims are getting new attention after a door plug was ripped off another Boeing jet, the 737 MAX 9, earlier this year. Fortune
Red homeowners, blue renters
U.S. homeowners are twice as likely to identify as strongly Republican than renters, who more often identify as strongly Democrat. The gap between homeowners and renters who identify as strongly Republican is 14%, larger than between non-college educated and educated voters (6%). Aziz Sunderji, the author of the Home Economics newsletter, suggests younger, liberal voters are increasingly moving to large, expensive cities and are thus pushed into the renter market. Fortune
A new S&P 500 member
Super Micro Computer, which makes servers, is set to join the S&P 500 index on Monday. Upon joining, the company will be the index’s top one-year performer with an over 12-fold increase, beating even Nvidia. CEO Charles Liang credits close cooperation with Nvidia for his company’s success: Super Micro’s head office is just 15 minutes away from Nvidia’s. The Wall Street Journal
AROUND THE WATERCOOLER
Analysis: Amazon sellers say their businesses are facing an extinction event—they might not be wrong by Jason Del Rey
Young talent gave us Microsoft, Apple and Facebook—but today, Gen Z bosses say they are treated as the butt of generational jokes: ‘You look like a child, are you sure?’ by Eleanor Pringle
Hertz’s electric vehicle and CEO about-face is the latest twist after a COVID bankruptcy filing and a deep relationship with Carl Icahn by Steve Mollman
How the richest woman in the world—mocked as a ‘miser’ in the press—helped bail out New York City during the panic of 1907 by Will Daniel
This edition of CEO Daily was curated by Nicholas Gordon.
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