Strategic Intelligence: ESG in Banking in the Age of Trump

In 2021, various bank CEOs declared ESG their number one strategic priority, rushed to outdo each other on ambitious net-zero claims, created new chief sustainability officer roles, brought in dedicated ESG headcount, and implemented wide-ranging diversity, equity, and inclusion (DEI) policies. Since then, the anti-ESG movement has grown steadily-sentiment that will only intensify under President Donald Trump, who signed an executive order withdrawing the US from the Paris Agreement hours after taking office, before scaling back DEI policies. This presents difficult strategic questions for all banks, but especially those that have placed big bets on ESG. Bank ESG policies are typically set against a mix of what other companies are doing, what an industry group says is best practice, and what a regulator has set as standard. But what should banks do when all of these are changing (and may all change again in three to four years with a new administration)? If banks do pull back some ESG policies, what blowback is likely from customers and/or employees, and around what specific elements of the broad ESG agenda?

This report identifies the key direct-to-consumer FS providers making their mark in the ESG theme. It offers a simple cross-sector definition of ESG and identifies the key gridlines of change expected to shape the evolution of ESG across the next 12-24 months. The industry analysis chapter shares a mix of consumer, executive, and investor survey data to map out how ESG sentiment has evolved globally over the last few years. Regional analysis covers the latest regulatory and political developments, highlighting how providers must calibrate ESG on a market-by-market basis. The value chain section maps out how organizational models are evolving to a deliver a more pragmatic, integrated, and lean ESG, before the report concludes with firm-level summaries covering the competitive position of leading players within the ESG theme.

Scope

• For years, large banks have been strategically deploying fintech ecosystems to drive sustainability in their products and operations. Often referred to as sustainable digital finance, this category includes mobile payment platforms, crowdfunding, big data, artificial intelligence, blockchain, digital tokens, and the Internet of Things.
• The analyst surveying indicates that ESG is the least important driver of provider choice across all markets, among all age groups and all wealth brackets.
• Asia-Pacific is forecast to experience the largest increase in HNW demand for ESG investments going forward, with the US forecast to record the largest decrease.

Reasons to Buy

• This report is essential reading for senior executives at financial services companies seeking to understand how to reassess and potentially recalibrate ESG efforts in accordance with evolving market conditions.
• Discover how and why ESG consumer care-abouts and regulations vary significantly by region and segment, requiring a carefully calibrated approach from providers.
• Learn how major FS institutions are taking a more pragmatic approach to ESG amid the evolving global landscape.