ESG (Environmental, Social, and Governance) it’s not dead!

At the beginning of this year, I attended a meeting where someone boldly declared, “ESG is dead.” My immediate instinct was to challenge them. But I held back sometimes, it’s not worth spending energy on people who have not truly grasped the bigger picture.

If ESG were truly “dead,” how do we explain the findings in the recently released 2024 Global Infrastructure ESG Report? According to the report, USD 106.74 billion was invested in ESG-aligned infrastructure this year 92% of that from private funding.

The shift is clear: sustainable investment strategies are gaining serious traction, even in sectors like defense and space. It’s a little known fact that Pentagon invests in renewable and sustainable energy solutions and significant amount of money.

This article is not just about ESG Environmental, Social, and Governance. It’s about the often overlooked interlink between ESG and cyber security a connection that many fail to see unless they’ve worked on both sides.

Recharge?

My Journey into ESG and Cyber security

I entered the ESG space in 2019, back when it was still emerging and not widely understood. My passion and curiosity drove me to explore how ESG intersects with cybersecurity. And what I found was both fascinating and concerning.

Typically, ESG is approached from a manufacturing or product lifecycle standpoint:

• Is the product environmentally sustainable?

• Does the company have the right governance structure?

But the complexity grows exponentially when AI enters the picture. AI systems demand significant computational power, energy, and server infrastructure raising concerns about their carbon footprint and sustainability. Have we fully considered the recycling and energy saving processes for these technologies?

Now, layer in cyber security risks. When we recycle hardware like servers or data storage systems, do we ensure secure data destruction? In infrastructure and waste systems, are there protocols in place to prevent data breaches during disposal or repurposing? Often, these questions aren’t being asked.

A Real World Example: ESG Meets Cyber security

A global client, major player in agricultural seed farming approached us for ESG support. Our initial approach was to develop a maturity model based on the Sustainability Accounting Standards Board (SASB) framework, which identifies material sustainability issues on an industry by industry basis.

As we dug deeper, we realised something critical: cyber security had been overlooked entirely. It was a crucial piece of the Governance puzzle.

Their farms operate across multiple continents, many surrounded by local villages. What if a cyberattack caused equipment failures in their waste disposal systems? It could lead to serious environmental incidents leaked waste contaminating water supplies, for example. The impact could be devastating, both for the environment and their reputation