Beyond Selective Stewardship: Reclaiming the Integrated Vision of Sustainability

The False Narrative of ESG and SDG Failure

In boardrooms and policy discussions worldwide, a troubling narrative has taken hold: that Environmental, Social, and Governance (ESG) frameworks and the UN's Sustainable Development Goals (SDGs) have failed to deliver on their promises. This perceived failure has led to backlash, with critics questioning the value of these frameworks entirely. But this narrative fundamentally misunderstands the problem.

The failure lies not in these frameworks themselves, but in their selective implementation - what I call "selective stewardship." Companies have cherry-picked the most convenient or marketable aspects of sustainability while ignoring the core principle that made these frameworks revolutionary: their integrated, holistic approach to creating lasting value.

The Origins of Integration: Revisiting the Triple Bottom Line

To understand where we've gone astray, we must return to the origins of modern corporate sustainability thinking. When John Elkington introduced the Triple Bottom Line (TBL) concept in 1994, he wasn't offering a menu from which businesses could select their preferred sustainability focus. Rather, he proposed a fundamental reimagining of corporate value creation that integrated economic prosperity, environmental quality, and social equity.

The power of the TBL framework was its insistence that these three dimensions were inseparable. A company couldn't claim success while excelling in profits but neglecting its environmental impact or social consequences. True sustainability required balanced attention to all three. Likewise, when the concept of "social license to operate" emerged from the mining industry in the late 1990s, it recognised that businesses need ongoing approval from communities, stakeholders, and society to function effectively. This approval couldn't be secured through environmental initiatives alone—it required addressing the full spectrum of a company's impacts on society.

The Rise of Environmental Reductionism - Sustainability Monoculture

Despite these integrated origins, corporate sustainability has increasingly narrowed to focus primarily on environmental metrics, particularly carbon emissions. This environmental reductionism manifests in sustainability reports dominated by climate disclosures while social and governance factors receive cursory attention.

The rise of net-zero pledges exemplifies this trend. While decarbonisation is undoubtedly crucial, the singular focus on emissions has created a sustainability monoculture where companies can claim to be "sustainable" based solely on their environmental initiatives, regardless of their performance on social equity, labour practices, or governance structures. This dynamic creates a subtle but pervasive form of greenwashing that affects even well-intentioned companies. Organisations genuinely committed to environmental progress can still be engaged in greenwashing when they present a narrative of comprehensive sustainability while focusing exclusively on carbon reduction. Many executives sincerely believe they are "doing the right thing" by prioritising emissions targets, unaware that sustainability, by definition, cannot be achieved through environmental progress alone. When companies celebrate their climate commitments while neglecting the "S"-factor, they perpetuate a fundamental misunderstanding of what true sustainability requires.

A striking example of this selective approach appears in nature-based voluntary carbon markets. The lack of a unified ESG framework has led to projects focusing solely on emissions mitigation, often at the expense of community welfare and broader environmental protection. Many initiatives prioritise carbon sequestration - capturing an estimated 42% of traded credits through reforestation and forest conservation - without ensuring fair revenue sharing or a duty of care towards local communities and ecosystems. This narrow focus undermines social and biodiversity safeguards, where carbon projects function primarily as financial instruments for offsetting emissions rather than vehicles for comprehensive, just environmental restoration. By neglecting to capture and report on socio-economic impacts, organisations also miss valuable opportunities to demonstrate the broader benefits that could come from more holistic approaches. Companies that rigorously track these dimensions could showcase how responsible offsetting contributes not only to emissions reduction but also to community development, social equity, and local economic resilience - telling a more complete sustainability story that goes beyond carbon accounting.

This selective approach isn't just theoretically problematic - it's proving ineffective in practice. Companies proudly announce carbon reduction targets while simultaneously lobbying against labour protections or maintaining governance structures that concentrate power and wealth. The most environmentally progressive companies can simultaneously maintain business models that exacerbate inequality or undermine community well-being.

The Hidden Costs of Selective Stewardship

The consequences of this selective approach are becoming increasingly apparent. The most alarming is the emergence of a "green divide" where environmental progress comes at the expense of social equity. When companies focus exclusively on environmental metrics, they often implement solutions that disproportionately burden vulnerable communities:

• Clean energy transitions that neglect displaced fossil fuel workers

• Sustainable product lines priced beyond the reach of lower-income consumers

• Environmental initiatives that concentrate benefits among already-privileged communities

• Climate adaptation measures that protect valuable assets while leaving vulnerable populations exposed

• Inequitable carbon markets where communities earn only 15%-30% of revenue share, resulting in a poverty trap

These outcomes aren't just ethically problematic - they're strategically shortsighted. Environmental initiatives that ignore social dimensions generate resistance, undermining their effectiveness and longevity. A transition perceived as unjust will inevitably face political backlash, as we've seen with yellow vest protests in France and resistance to carbon taxes in various jurisdictions. More concerning, when climate action becomes unrelatable to everyday concerns and economic realities, it creates fertile ground for broader policy reversals - from the U.S. withdrawal from the Paris Agreement to financial institutions exiting the Net Zero Asset Managers initiative (NZAM). This disconnect plays directly into the hands of climate action opponents, though in a nuanced way. Many labeled as "climate deniers" aren't opposed to environmental conservation or sustainable development broadly. Rather, they struggle to relate to abstract global warming concepts that seem disconnected from local realities and immediate economic concerns. When climate policies appear to prioritise distant environmental goals over immediate social and economic needs, they become vulnerable to political opposition that leverages these legitimate grievances, further delaying necessary action.

These political and cultural barriers created by selective stewardship compound its direct economic impacts. A selective approach also leads to stagnation in broader climate transition efforts. When influential investors and foundations apply ESG principles selectively, we see fragmented initiatives rather than the cohesive advancement needed for effective climate action. Even more concerning, when significant capital flows to entities with only partial ESG commitments, it signals to the market that comprehensive sustainability practices aren't imperative, potentially discouraging industries from adopting truly holistic approaches.

SDG Accountability Gap: Designed for Integration, Implemented in Isolation

The UN Sustainable Development Goals were explicitly designed as an integrated framework - 17 interconnected goals that collectively map the path to a sustainable future. The preamble to the SDGs emphasises that they are "integrated and indivisible," with progress on any one goal depending on progress across all goals.

Yet in practice, the majority of organisations have treated the SDGs as a collection of separate initiatives, focusing on those most aligned with their existing priorities or brand positioning. Companies proudly highlight their contributions to specific goals while ignoring those that would require more fundamental business model changes.

This selective approach creates a dangerous accountability gap: companies can cause harm across the full spectrum of SDGs while cherry-picking positive impacts against only the goals they find most convenient or cost-effective to address. A mining company might highlight its contributions to SDG 7 (Affordable and Clean Energy) through investments in renewable power for its operations, while remaining silent on its negative impacts on SDG 15 (Life on Land) or SDG 6 (Clean Water). Similarly, a technology firm might showcase initiatives advancing SDG 4 (Quality Education) while overlooking its connections to SDG 10 (Reduced Inequalities) through tax avoidance practices or algorithmic discrimination.

The resulting imbalance between comprehensive detriment and selective impact mitigation undermines the transformative potential of the SDG framework. The goals were never meant to be a CSR checklist from which companies could select their favorites, but rather a comprehensive blueprint for systemic change that acknowledges the interconnectedness of social, environmental, and economic challenges.

The Paradox of Selective Stewardship

A notable paradox emerges in the climate transition discourse: industries such as mining and oil are often compelled to adopt comprehensive ESG strategies to maintain their social license to operate, while sectors like responsible investing and philanthropic foundations frequently exercise the discretion to focus selectively on certain ESG aspects.

High-impact sectors face stringent scrutiny from the public and regulatory bodies. To sustain their operations, these industries are often mandated to implement holistic ESG strategies that address environmental concerns, social responsibilities, and governance practices simultaneously. Conversely, responsible investors and philanthropic foundations possess the latitude to prioritise specific ESG components that align with their missions or market trends. This selective engagement leads to an uneven emphasis across the ESG spectrum. Some ESG funds, while marketed as sustainable, invest significantly in major polluting companies, raising legitimate concerns about greenwashing.

This imbalance in ESG engagement has profound implications for resource allocation. Philanthropic foundations focusing narrowly on certain ESG aspects might overlook critical areas requiring attention, leading to imbalanced resource distribution and missed opportunities for transformative impact.

Reclaiming the Integrated Vision

The solution isn't to abandon ESG principles or the SDGs, but to reclaim their original integrated vision. This requires several fundamental shifts:

1. From Selective to Systemic Thinking: Companies must recognise that environmental, social, and governance factors are interconnected parts of a single system. Progress on one dimension that comes at the expense of others isn't true progress.

2. From Metrics to Meaning: We need sustainability frameworks that prioritise meaningful impact over convenient metrics. This means developing evaluation approaches that capture complex interdependencies rather than isolated indicators.

3. From Transactional to Transformational: Companies must move beyond viewing sustainability as transactional (offsetting emissions, donating to causes) to seeing it as transformational - fundamentally reshaping business models to create integrated value.

4. From Shareholder to Stakeholder Capitalism: Truly integrated sustainability requires broadening the definition of business success beyond shareholder returns to encompass the full range of stakeholder impacts.

5. Comprehensive Standards: Developing and adhering to clear, standardized ESG criteria can ensure that all sectors - from high-impact industries to investors and foundations - are held to consistent expectations, minimising selective engagement.

6. Transparent Reporting: Mandating detailed disclosures of ESG activities and investments enhances accountability and provides stakeholders with a clear understanding of an entity's holistic commitment to sustainability.

Leading the Way: Examples of Integrated Approaches

Some organisations are already demonstrating what integrated stewardship looks like in practice:

• Companies designing circular economy initiatives that simultaneously address resource constraints, create meaningful employment, and distribute value more equitably

• Businesses reimagining their supply chains to enhance both environmental performance and human rights protections

• Investors developing truly integrated ESG evaluation frameworks that assess how performance in one dimension affects others

• Financial institutions creating lending products that simultaneously address climate adaptation and community economic development

• Organisations strategically offsetting through high-integrity, high-impact carbon projects within the voluntary carbon market, paying premiums for offsets with equitable revenue sharing and robust community/environmental safeguards, while internal committees become more educated on evaluating these multidimensional criteria

• Collaborative initiatives between high-impact industries, investors, and foundations that facilitate the sharing of best practices and promote integrated approaches to ESG implementation

Industries traditionally associated with significant environmental impacts, such as mining and oil, have long faced intense scrutiny. To maintain their "social license to operate," regulations and public pressure dictate they adopt holistic approaches encompassing environmental stewardship, social responsibility, and robust governance.  This regulatory and societal expectation demonstrates a critical understanding: addressing environmental concerns alone is inherently insufficient for any sector's long-term viability. These industries are expected to integrate community engagement, fair and safe labour practices, and local economic development into their operational strategies - a standard of comprehensive accountability that starkly contrasts with the selective approach permitted in other sectors.

These differential expectations highlight that true sustainability isn't about balancing tradeoffs between environmental and social priorities, but rather about advancing all dimensions simultaneously through integrated solutions. The stringent requirements placed on high-impact industries offer valuable lessons for investors, foundations, and other sectors currently exercising more selective approaches to ESG implementation. If comprehensive accountability is deemed necessary for industries with obvious environmental impacts, why should we accept anything less from financial institutions, technology companies, or consumer brands whose impacts may be less visible but no less significant?

A Call for Authentic Stewardship

The coming decade will determine whether corporate sustainability efforts genuinely contribute to solving humanity's most pressing challenges or simply provide cover for business as usual. The path forward requires authentic stewardship - a return to the integrated vision that made concepts like the Triple Bottom Line and the SDGs revolutionary in the first place.

This means rejecting the false choice between environmental progress and social equity. It means acknowledging that governance reforms are essential enablers of both environmental and social performance. Most fundamentally, it means recognising that sustainability isn't a department or initiative within the business - it's a comprehensive approach to creating value that enhances economic, environmental, and social outcomes simultaneously.

The narrative that ESG and the SDGs have failed us is misguided. What has failed is our commitment to implementing these frameworks with the integrity and integration they demand. By reclaiming their original integrated vision and rejecting selective stewardship, we can unlock their full potential to create a more sustainable and equitable future.

GUD is an equitable carbon market partner, MRV technology developer, and distributor of high-integrity carbon credits.