ESG Dive posted an interesting article yesterday on trends to watch in 2025. With the upcoming change in presidential administrations, some are predicting a course reversal on ESG; however, as this article notes, although we are already seeing pull back in a number of areas, it is unlikely that the new administration will be able to completely undo all of the progress that has been made. The article by ESG Dive highlights five trends to watch in 2025, which are briefly summarized below.
1. Climate alliances no longer desirable memberships for Wall Street
As the article notes, the United Nations-backed Net-Zero Banking Alliance (NZBA)—whose members have committed to align their lending, investment and capital markets activities with global efforts to tackle climate-change—has been the target of several recent GOP-led probes and investigations. As of today, perhaps in response to this pressure, all six of the U.S.-headquartered banks have departed the NZBA. Only three U.S.-based banks remain—Amalgamated Bank, Climate First Bank and Areti Bank.
Other climate alliances have been targeted as well. As noted in the article, a recent report from the House Judiciary Committee found that over 70 investors have left CA100+ in the years since Republicans on the committee have investigated that group.
Many environmental advocates have expressed concern over this recent pattern of withdrawals from climate alliances, particularly in the wake of the upcoming change in administrations.
Adding to this concern, the Associated Press today reported that the Earth recorded its hottest year ever in 2024, with such a big jump that the planet temporarily passed a major climate threshold.
2. U.S. federal climate and ESG deregulation won’t stop mandatory reporting
As noted in the article, regardless of how the new presidential administration pivots on ESG and climate-focused regulations (including the anticipated abandonment of the SEC’s previously adopted climate disclosure rule, which continues to be challenged in court), a large number of U.S. companies will still likely be required to disclose climate-related data to various U.S. and international regulators and are already preparing for this reality.
California’s climate disclosure rules, which are the subject of ongoing litigation, will require reporting beginning in 2026 by certain large companies doing business in California, and a number of companies will also be subject to the EU’s Corporate Sustainability Reporting Directive beginning in 2026.
Additionally, as noted in the article, jurisdictions representing at least 55% of the global gross domestic product are aligning or incorporating the International Sustainability Standards Board’s standards into their legal or regulatory reporting frameworks.
3. Corporations continue to steer away from DEI
As the article notes, many corporations are abandoning (at least publicly) their DEI commitments in the wake of growing political pressure and anxiety over how the upcoming administration views such initiatives. This trend is likely to continue under the new presidential administration.
4. AI’s soaring demand could continue to drive appetite for clean energy
It has been well reported that the increased use of artificial intelligence and generative AI will lead to an increased demand for energy. The article cites a report by Rhodium Group, which found that electricity demand is expected to increase 24-29% over 2023 levels by 2035.
The incoming Trump administration has indicated its intention to increase fossil fuel production, the article notes. However, a number of big tech companies are already committed to clean energy, and the economics have grown over the past few years to support its adoption. As the article notes, companies including tech giants Microsoft and Meta are also looking to nuclear power as a cleaner alternative.
5. The increase in green investments and tech will continue, just slower
According to the article, while an adversarial federal stance on ESG and climate change is expected to slow the pace of the clean energy transition over the next four years, experts believe the private sector will continue to accelerate its work on the transition under the Trump administration.
The article cites a report by Net Zero Tracker, which finds that at least 1,750 global companies have set net-zero targets and predicts that companies will continue to invest in clean energy and other clean technology industries that were catalyzed by the investments provided for by the Inflation Reduction Act and Bipartisan Infrastructure Law.
Read the full article, 5 ESG Trends Sustainability Professionals Should Monitor in 2025, on ESG Dive.