By Marina Grossi*
Issues such as a turbulent geopolitical context, armed conflicts, the escalation of disinformation, and profound changes in work models figure, year after year, among the main threats to global economic stability identified in the global risk reports prepared by the World Economic Forum. These crises unfold against the backdrop of what I call "the triad of socio-environmental crises": the advance of climate change, the record loss of biodiversity, and the worsening of social inequalities, especially in the post-pandemic context.
The need to address pressing environmental issues and the challenge of development are discussions that have gained relevance since the 1970s, with the Stockholm Conference in 1972 as a starting point. There, the definition of sustainable development was coined – development that meets the needs of the present generation without compromising the ability of future generations to meet their own needs, reconciling socioeconomic progress with environmental preservation and the rational use of resources. At the time, some of the 113 countries that sent representatives to the first United Nations conference on environment and development were vehement in defending their "rights to pollute in order to develop" – and this includes Brazil, at the time driven by the so-called economic miracle. Stockholm, however, provided the basis for this global discussion, which twenty years later would arrive with greater weight and maturity at Rio-92.
On Brazilian soil, more precisely in Rio de Janeiro, representatives from 179 countries delved into discussions on sustainable development. From this meeting emerged the UN Framework Conventions on Climate Change, Biological Diversity, and Combating Desertification, which established the holding of periodic meetings (annual or biennial) to address these issues, the Conferences of the Parties, or COPs. The Earth Summit, as it also became known, also marked a shift in the attitude of companies towards understanding the concept of sustainable development.
This seed quickly germinated, giving rise to business movements born from the understanding that companies have an essential role in transforming the economy and generating prosperity in a sustainable way. An example of this is the Brazilian Business Council for Sustainable Development (CEBDS), which was created in 1997 by a group of visionary and attentive businesspeople. zeitgeist, Inspired also by the formation of the World Business Council for Sustainable Development (WBCSD) two years earlier, this global business vanguard, comprised of over 200 companies, created a movement to integrate the principles of sustainable development into business practices by reconciling the economic, social, and environmental dimensions.
From then on, the following decade was prolific in initiatives that engaged companies in commitments and strategies aimed at sustainability. Examples include the UN Global Compact; the Equator Principles; the Global Reporting Initiative (GRI) indicators; the creation of the first sustainability portfolios for stock exchanges – the Dow Jones Sustainability Index (DJSI) in New York; and the Corporate Sustainability Index (ISE) at the then Bovespa; among others. It is important to highlight that, even in the 1990s, the concept of sustainability In business, the concept emerges from several theorists, such as the British sociologist John Elkington, who coined the term 'triple bottom line,' which examines the social, environmental, and economic impact of a company.
According to Elkington, the three pillars Profit-People-Planet underpin the interaction between companies and communities, and the theorist proposes that the impact of a company's business should not be restricted to the economic dimension – generating revenue and jobs and paying taxes – but also to the social and environmental dimensions, so that companies cannot consume natural resources to the point of harming future generations – directly engaging with the line of thought that emerged from 1972 onwards.
In 2004, the term ESG emerged for the first time; it is an acronym for Environmental, Social, and Governance., which corresponds to Environmental, social, and governance practices of an organization. The term was coined in a report by the Global Compact in partnership with the World Bank, called Who Cares Wins. It arose from a challenge posed by then-UN Secretary-General Kofi Annan to 50 CEOs of major financial institutions, regarding how to integrate social, environmental, and governance factors into the capital market. The report's thesis is that the pressures faced in these areas will tend to transform the business environment, such that companies that do not incorporate these variables into their way of doing business tend to lose ground, while those that perform well will be valued by the market.
Thus, the ESG agenda is now seen as a guide for corporate management, converging towards the global objective of a sustainable development model. This positions companies and investors as part of the solution and outlines their role as promoters of a prosperous, economically and socially just, equitable, and environmentally responsible society. Today, this vision is consolidated. Companies have understood that serious environmental crises, especially the climate emergency, are a direct risk to competitiveness, as they affect their supply chains, costs, and reputation. At the same time, action on the ESG agenda has become an engine for innovation and investment.
An example of this is in the report. Business Breakthrough Barometer 2025, According to the WBCSD, more than half of business leaders in 50 countries are already increasing investments in targets for reducing greenhouse gas emissions towards carbon neutrality, the so-called 'net zero' policies, to ensure long-term competitiveness. In other words, companies' engagement in the climate agenda has ceased to be a response to regulatory pressures and has become an expression of a strategic vision for the future, based on innovation, efficiency and shared value.
This study, based on the insights of over 300 business leaders worldwide, reveals important findings regarding companies' motivations for pursuing ESG objectives, especially in their environmental pillar of responding to climate change. The level of recognition of its importance is high: 56% of the leaders cited long-term competitiveness as the main motivation for investments in climate neutrality, with 91% maintaining or increasing their investment in these policies in 2024; another 94% consider public policies supporting the transition to a low-carbon economy critical factors in investment decisions; and 92% already recognize that the cost of inaction will be greater than the cost of transition. Finally, for 61%, it is certain that the costs resulting from climate impacts will increase and impact their businesses.
The study showed that companies are focusing on technologies that offer sustainability and commercial return, such as renewable energy, electric vehicles, and other low-carbon solutions with strong market momentum and decreasing costs. In sectors that are more difficult to decarbonize, such as steel and cement, companies are adopting a more targeted approach, investing where they see clear signs of demand and potential for supportive policies. But across all sectors, the direction is clear: companies increasingly see a focus on decarbonization as a strategic necessity to remain competitive in constantly evolving markets. Companies are acutely aware of the growing environmental and climate impacts and are urging governments to stay the course, as companies cannot bear the burden alone.
ESG as a tool for reputation management.
Beyond the argument of competitiveness and innovation, commitment to ESG policies should be understood as a robust model for managing risks and opportunities, and also as an instrument for managing the reputation of companies seeking longevity. More than just complying with regulations or policies, forward-thinking companies understand ESG policies as strategic for strengthening their brands and as catalysts for value creation for consumers, investors, and other stakeholders. In the current "Reputation Era," as postulated by the consulting firm Caliber, trust and transparency are fundamental attributes, and integrating ESG into operations is an assertive way to demonstrate positive impacts on society – above all, it shows that the company looks beyond its own walls.
This is even more significant when considering the context of Brazilian companies. Brazil has concrete competitive advantages when it comes to sustainability: we possess a highly renewable electricity matrix (approximately 901 Tbp from clean sources) and are home to the greatest biodiversity on the planet, in addition to having a tropical climate, fertile soils, and an abundance of natural resources across our vast territory. Therefore, Brazilian companies have already understood that pursuing management in line with the ESG agenda and sustainable development brings undeniable benefits to their brands, solidifying their reputation.
Leading Brazilian companies have understood ESG as a business asset: companies that have incorporated sustainability into their strategic planning not only differentiate themselves in the market, but also expand their ability to compete on the global stage. Today, with around 115 large member companies, CEBDS is a witness to this progress in Brazil. More than encouraging the adoption of ESG policies within companies, CEBDS has also been a facilitator in the formation of business coalitions for decarbonization, a movement that had already been gaining strength since the signing of the Paris Agreement in 2015, and became evident at COP30 in Belém.
Following the call from the COP30 Presidency for a “global effort” against climate change, CEBDS spearheaded the formation of four major coalitions in strategic sectors (Transport, Electricity, Agriculture, and Essential Minerals). This movement brought together 270 companies and organizations that, in a convergent manner, developed maps for mitigating climate change in their sectors, contributing to public policy (Climate Plan) and leaving a real legacy of continuity. This is, without a doubt, the largest business movement for implementing actions to combat climate change ever built in Brazil, and it will yield many positive results.
Despite all the progress made over the years, the ESG agenda still faces significant challenges, including the effects of increasing political polarization. This context has led to adjustments and repositioning in the short term, but it does not alter the economic fundamentals that underpin this agenda. A recent Bloomberg study shows that, for the fourth consecutive year, the largest Wall Street banks have earned more revenue from financing projects related to the climate transition than from operations associated with fossil fuels. By 2025, loans and bond issuances aimed at green initiatives totaled approximately US$3.7 billion.
These data reinforce that, despite short-term obstacles and disputes, ESG does not represent a passing or ideological agenda, but a structuring vector for competitiveness, risk management, and long-term value creation. Companies' engagement with environmental, social, and governance criteria reflects a strategic vision aligned with innovation, access to capital, and the building of solid and resilient reputations, consolidating ESG as a central element for the longevity of businesses in a changing world.
* Marina Grossi is the president of CEBDS (Brazilian Business Council for Sustainable Development) and Special Envoy of the Business Sector to COP30.
