Trump’s anti-sustainability agenda comes to Eurozone • The Register
Canalys Forums 2025 US President Donald Trump released a wrecking ball that smashed through environmental, social, and governance (ESG) policies stateside – and it’s now swinging across the Atlantic, according to analysts.
ESG has taken a significant backward step since Trump’s administration took power in January. Diversity, equity, and inclusion commitments are being forgotten or watered down, and carbon emissions goals are being rewritten.
Against this backdrop and without namechecking the man in the Oval Office, Ben Caddy, senior analyst at Omdia, said it “feels like we’ve had a real paradigm shift on sustainability” – and not in a good way.
“It seemed like companies were really taking it seriously,” he told an audience of tech suppliers at the Canalys Forums event in Barcelona. “For the first time, we were seeing companies appointing chief sustainability officers or even talking about sustainability and marketing it in their earnings calls.
“It was everywhere, but only for a few years. In the last 12 months, something seems to have changed, and sustainability has experienced somewhat of a total system crash.”
He added: “In the 2024 US election, obviously sustainability, ESG, especially DEI, became toxic political footballs thrown around in the American culture war, and in the aftermath of that election, vendors are terrified to even use that language.”
Just recently, investors were obsessed with green bonds, regulators fixated on disclosure and transparency around carbon emissions and energy use, and corporate staff paid close attention to their environmental footprint. Money still makes the world go round, and sustainability featured prominently in tenders for new contracts as governments and organizations sought to meet compliance obligations.
“If you didn’t have a credible sustainability strategy, or if you weren’t telling a sustainability story that resonated with the customer, you would be left out of critical deals,” noted Caddy. “Many of you tied sustainability performance to executive pay. You even got validated science based targets.”
“But everyone wanted a piece of the sustainability pie, so people kind of started to greenwash. They started to talk sustainability without even understanding it and doing it themselves.”
Hyperscalers, as The Register has highlighted before, began to emit “outlandish carbon reduction claims” that didn’t hold up to scrutiny and hardware vendors stuck eco labels on their recycled packaging, he said.
Microsoft’s carbon emissions have surged almost 30 percent since 2020 and Google reported a 48 percent climb since 2019. Amazon doesn’t provide AWS-specific location-based data, so no one outside of the corporation is able to ascertain its total carbon footprint.
This hype, or “greenwashing,” served to “set sustainability up for a total failure when the pressure finally hit,” and hit it has. Canalys polled suppliers downstream in the supply chain who claimed the single biggest threat to IT sustainability progress this year was geopolitical contention over sustainability itself.
“Hyperscalers’ emissions are completely out of control, and they’ve lost control of the narrative,” said Caddy.
Datacenters being constructed for AI training and inference are a major contributor to the challenges that Microsoft et al face. Carbon emitted by DCs is forecast to be three times greater by 2030 than if generative AI had not been developed. And more coal is being burned to power these facilities. Rising electricity prices are also being blamed on datacenters.
Outside of tech, Barclays, JP Morgan, and Goldman Sachs have left the UN-backed Net Zero banking alliance, precipitating its recent collapse.
Caddy said: “There’s been a complete change in sentiment, and that geopolitical pressure has started to run over to Europe as well. Anti-ESG politics in Europe have caused the EU to massively roll back the scope of its landmark corporate sustainability finance reporting by 80 percent.”
Sustainability may be struggling to remain relevant for CIOs now more interested in agentic AI, security or the cloud, yet according to a poll of channel partners, sustainability is “critical” to their “financial resilience as climate change worsens” and it remains a key factor when selling to certain customers in government and the commercial sector.
Just because the “political pendulum swung the other way” does not mean the IT industry should ignore it as a financial and ethically sound practice, argued Caddy. “The hype has ended, and it’s time to get the work done.” ®
