The administration has also made its disdain for ESG (environmental, social, and governance) assessments in the corporate world abundantly clear. It has shown contempt for corporate commitments to reduce dependence on fossil fuels and is even exploring ways to label ESG initiatives or corporate decarbonization strategies as “anti-competitive collusion.” This includes threats to subpoena managers and board members of companies pursuing such strategies.

One might question how a government with libertarian leanings justifies interfering with corporate intentions—unless, of course, those intentions are criminal. But the larger issue is whether such efforts benefit companies or society at large. We believe that ignoring the realities of ecological overshoot is not only counterproductive but also economically damaging. Companies that fail to prepare—particularly in terms of their product offerings—for the inevitable challenges of climate change and resource constraints are undermining their own futures.

In essence, the U.S. is spending public resources to blind itself to an unavoidable reality, recklessly undermining its ability to respond and prepare effectively for a trend inaction makes even more likely, if not certain.

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In reality, these companies present a strong value proposition, as failing to prepare for a predictable future of climate change and resource constraints is against their self-interest. Additionally, a company’s contribution to global overshoot is measurable. After three decades of providing robust country overshoot data, a similar approach is now needed for companies.

The key question is: How much does a company reduce global overshoot per million dollars market capitalization? In other words, if the company did not exist, where would global overshoot stand per million dollars market capitalization?

For most companies, due to their existence, global overshoot increases, and hence Earth Overshoot Day arrives sooner. But some companies—circular businesses—reduce global overshoot as they grow. Here is one example. If you want to get even more inspiration, check out the Power of Possibility with over 100 examples.

This is also relevant to investors. Because, once the question can be answered for companies, it becomes possible to measure as well for a portfolio how much it moves global overshoot per million dollars investment. We still have not seen an impact investment portfolio that has tracked its impact on global overshoot, let alone one that actually reduced global overshoot. Should they then even be called impact funds?

Even conventional portfolios: Would they not be better off having, at least as a hedge, companies in their mix that will maintain value in a future of climate change and resource constraints?

Additional Resources:

• Power of Possibility examples
• Overshoot impact of companies: How to assess
• Analytical insights such assessments enable
• Whitepaper on one planet prosperity
• Overshoot: is there good news?

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