Sustainable Investing: ESG Trends To Watch This Summer
By Brian Famigletti, Managing Director & Head of Marketing
A Look Into Sustainable Investing
Sustainable investing, or investing in companies that prioritize certain social and environmental outcomes, remains popular across the globe. Morgan Stanley recently found that nearly 90% of investors in the U.S. and abroad are interested in the practice.
Environmentally conscious investors analyze environmental, social, and governance (ESG) factors to gauge the sustainability of a potential investment. Environmental factors may include green energy initiatives and emissions caps. The social category considers elements such as employee diversity and customer satisfaction. Governance examines company leadership: board member diversity, executive pay, and more.
In recent years, more and more businesses across the board have been asked to provide ESG data, according to the Center for Sustainability and Excellence. However, President Donald Trump’s second term could shake things up stateside.
Rolling Back ESG Policies
While many countries around the world are taking steps to bolster ESG investing, the U.S. could move in the opposite direction under President Trump. A recent shakeup in the U.S. Securities and Exchange Commission (SEC), which regulates publicly traded companies, might signal what’s ahead.
Last year, the SEC adopted climate change disclosure rules that would have required thousands of companies to report extensive information on their environmental impacts. The rules had a particular focus on greenhouse gas emissions. Costly litigation quickly followed.
The SEC — now headed by a Trump appointee — voted in March to end its defense of those rules. The following month, President Trump signed an executive order asking the U.S. attorney general to identify and block any state laws that address climate change and ESG initiatives. The order reasoned that these rules threatened the U.S. economy and domestic energy production.
ESG Trends to Watch
These changes haven’t stopped some U.S. investors from prioritizing sustainable investing. A recent Morgan Stanley report found that interest levels remain largely unchanged since late 2023.
But while interest may remain steady, the ESG landscape is still sure to shift under the Trump administration.
For example, in 2024, the SEC cracked down on several companies it accused of making false claims about ESG efforts. In one instance, Keurig was charged with failing to disclose key information about the recyclability of its K-Cup single-use pods, leading to a $1.5 million settlement. These enforcement actions will likely lessen under the Trump administration, given the president’s anti-ESG stance.
Additionally, the rise of artificial intelligence could change the ESG landscape. According to CSE, businesses might start providing real-time environmental updates instead of annual reports, thanks to AI capabilities.
If you’re interested in building a portfolio that prioritizes sustainability, contact Griffin Asset Management to speak with an expert.
Sources:
Morgan Stanley: Individual Investor Interest in Sustainable Investing Remains Strong
CSE: The Future of Corporate Sustainability: 7 Key ESG Trends to Watch in 2025 and Beyond
Silver Regulatory Associates: The Evolving ESG Landscape: Trends to Watch in 2025
Investopedia: What Is ESG Investing?
NerdWallet: ESG for Beginners: Environmental, Social and Governance Investing
New York Times: S.E.C. Moves to Kill Climate Disclosure Rule
Reuters: Trump issues order to block state climate change policies
SEC: SEC Charges Keurig with Making Inaccurate Statements Regarding Recyclability of K-Cup Beverage Pod
Corporate Governance Institute: The future of ESG in 2025: a world divided
