The Biden administration has signaled a strong desire to make environmental, social, and governance (ESG) considerations more central themes in government policy, corporate disclosure, and investor and corporate behavior. Policies directed at addressing climate change get the most attention, but we expect significant policy shifts across all areas of ESG. These shifts will not only change disclosure requirements, but may fundamentally affect the economics of certain value chains, capital-labor relationships, and the legal risks of corporates. As a result, US corporates need to step up their ESG orientation. One place to start is a simple set of questions management teams can ask themselves to better understand how prepared they are for the expected policy shift.
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