Introduction
ESG (Environmental, Social, Governance) is a dual-natured phenomenon: on one hand, it is a technical tool for assessing non-financial risk; on the other, it is a powerful architecture of influence shaping corporate decisions. This article analyzes how the system promoted by global elites extends beyond transparent reporting to become a form of soft business politicization. Readers will learn how investor coalitions influence capital allocation, potentially violating fiduciary duties and bypassing democratic processes in the name of "stakeholder capitalism."
ESG: Technical Architecture and Institutional Frameworks
In technical terms, ESG is a set of metrics used to evaluate corporate impact. However, in an institutional sense, it is an intricate web of pressure in which passive funds monopolize corporate governance. The ideological divide is marked by Klaus Schwab, who promotes responsibility toward all stakeholders, and Milton Friedman, who defends the primacy of profit within the bounds of the law. Critics like Vivek Ramaswamy point to the phenomenon of greensmuggling—the smuggling of political agendas into funds without a clear mandate from investors.
This mechanism allows financial giants to use proxy voting to push non-financial goals, as demonstrated by the ExxonMobil case. Unlike greenwashing, which is merely a marketing facade, greensmuggling serves as a real tool of power over capital, altering board structures against the will of some shareholders.
Vivek Ramaswamy: ESG as an Ideological Cartel
According to Ramaswamy, initiatives such as Climate Action 100+ operate like a quasi-cartel that limits the supply of capital to selected sectors through coordinated pressure. Although U.S. regulators initially favored these trends, the situation is changing dynamically—in 2025, the SEC retreated from defending rigorous climate rules following a wave of lawsuits. Normative chaos increases legal costs and undermines market stability.
Empirical data tempers the enthusiasm: the belief that ESG always reduces the cost of capital and rewards performance was tested by rising interest rates and outflows from ethical funds in 2023–2024. The collapse of the FTX exchange, which received high scores despite a lack of real oversight, exposed the fiction of rankings based on narrative rather than robust institutions. ESG often improves rhetoric but not necessarily cash flows.
Rapid Transformation and Economic Foundations
Implementing ESG generates real social costs. An example is the rapid transformation in Sri Lanka, where a fertilizer ban led to an agricultural collapse. At the corporate level, ESG undermines the foundations of the classic fiduciary principle, replacing neutral profit maximization with a vague matrix of goals. This encourages institutional isomorphism—the mindless copying of reports by companies seeking market legitimacy.
The African Ubuntu philosophy provides an interesting counterpoint. Unlike the Western model based on bureaucratic rating tables, Ubuntu builds responsibility on organic relationships and communal reciprocity. This shows that business ethics can grow from local contexts rather than just top-down, globally imposed reporting standards.
Summary
ESG emerges as a phenomenon suspended between capital mobilization and a reputational bubble. On one hand, it can effectively direct funds toward civilizational challenges; on the other, it risks eroding democracy by placing power in the hands of self-appointed regulators. In the pursuit of ethical capital, will we lose sight of the fundamental principles of transparency? Perhaps instead of universal indicators, we should build responsibility based on relationships and local contexts, following the example of African Ubuntu, while avoiding the trap of the "machine of irresponsibility."
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