Sustainability Decisions In 2025: How an Uncertain Policy Landscape is Influencing ESG Decisions
Posted By on Mar 23rd 2025
The first few months of 2025 have been tumultuous on many fronts, and the world of sustainable business is no exception.
With a new US administration, the future of ESG efforts has been increasingly uncertain. In addition to this political change, factors like rising costs, emerging legislation, and consumer pressures create a nuanced and rapidly evolving environment for conscious brands.
To help you understand today’s landscape and identify the best path for your brand, we’ve put together an overview of key trends, current responses from other brands, and resources and recommendations for moving forward.
Table of Contents
- Political Trends That Impact Brand Sustainability Decisions
- Additional Current Issues That Influence Companies’ Sustainability Decisions
- Companies That Are Walking Back or Eliminating ESG Goals
- Companies That Are Staying Strong With Sustainability Commitments
- Why It’s Still a Smart Move to Focus on Sustainability
- Navigating Sustainability Decisions as a Conscious Brand
Source: Unsplash
Political Trends That Impact Brand Sustainability Decisions
Where the previous administration generally supported climate action, the current administration has shown disregard and even hostility for sustainability initiatives.
This shift in the government’s approach is already impacting brand decisions. Some companies have reduced or eliminated sustainability goals, while others are doubling down on their commitments. As federal policies continue to evolve, brands will need to identify and stick to their priorities.
Here are some key political trends that are playing a role in sustainability decisions.
Reversals of ESG Policy
The new administration has targeted climate action since Day 1. Notably, Trump withdrew the United States from the Paris Accords, making the U.S. the only nation to leave after signing.
Other climate-related policy changes include:
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Orders to expand logging, as well as gas and oil production
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Restrictions on new clean energy projects
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Firing of thousands of federal employees in organizations like the EPA and NOAA
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Removal of references to climate change from government websites
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Banning paper straws from federal facilities and encouraging nationwide bans
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Attempts to prevent cities and states from implementing their own ESG policies
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“Rejecting and denouncing” the United Nations Sustainable Development Goals
Some of these changes will affect brands directly, while others will have less obvious impacts.
Implementation of Tariffs
Source: Farm Journal, Inc.
One of the most notable economic factors to emerge from the new administration is the introduction of proposed tariffs.
Current proposals would impose tariffs on Canada, Mexico, and China, varying rates as high as 25%, depending on the product and country. While many details are still unclear, and full rollouts are yet to come, we expect to see some of the following unfold.
If implemented, tariffs will likely affect brands’ sustainability decisions in several ways.
Higher supply chain costs. In many cases, ethical sourcing and sustainable packaging are already more expensive than their conventional counterparts. For cost-sensitive brands, the additional expense of tariffs may lead to letting go of conscious packaging for the time being.
Increase in domestic sourcing and manufacturing. To avoid tariffs and duty fees, some brands may choose to “reshore” operations, sourcing, and manufacturing within the United States. Long-term, domestic sourcing can help reduce carbon emissions and overall footprint. However, these efforts take time and resources to implement.
Redirecting budgets. As companies figure out how to navigate tariffs in their supply chains, some may choose to pull resources from ESG initiatives to make up the difference and boost short-term capital.
Consumer price sensitivity. As costs go up, many consumers will be looking for ways to stretch their budgets. Brands will need to focus on differentiating their products and attracting customers. For some brands, this will mean emphasizing their sustainability efforts and values.
Climate-Related Litigation
Norton Rose Fulbright’s 2025 Annual Litigation Trends Survey showed that companies were increasingly conscious of potential sustainability litigation, both pro- and anti-ESG.
On the one hand, pro-ESG litigation could come from measures such as:
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Greenwashing enforcement (such as the FTC’s Green Guides)
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Emerging EPR legislation in states like Oregon
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Climate disclosure laws
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Socially-driven lawsuits from private sources
On the other hand, anti-ESG litigation may increase following the new administration. Lawsuits and bills opposing ESG in corporations and government entities are not new, but the changing federal attitudes may lead to increased anti-ESG lawsuits. These trends may also embolden private individuals to seek anti-ESG litigation.
For example, in January 2025, Texas Attorney General Ken Paxton led a coalition of states that threatened legal action against financial institutions like Goldman Sachs and BlackRock if they did not withdraw from ESG-driven investments.
Navigating this “push and pull” of litigation presents a challenge for brands, and staying current on compliance requirements will become increasingly important.
Source: Unsplash
Additional Current Issues That Influence Companies’ Sustainability Decisions
While the new United States administration plays a significant role in 2025 sustainability decisions, it’s far from the only factor brands must consider.
Four other notable trends include the continued development of state-led sustainability requirements, evolving international policies, retailer sustainability goals, and increasing consumer pressure.
State-Led EPR Laws and Sustainable Packaging Requirements
While federal sustainability efforts are likely to stall over the next four years, individual states are already making moves to implement climate-related policies. One notable focus of many of these policies is packaging.
Oregon, Colorado, California, Maine, and Minnesota have all passed Extended Producer Responsibility laws for packaging, and similar bills are under consideration in other states.
Oregon’s first reporting deadline for producers is set for March 31st, 2025, marking a major milestone for EPR laws in the United States.
Other sustainability policies include bans on specific materials, such as PVC or PFAs, and transparent labeling requirements for claims such as recyclability.
Some policies apply only to specific companies, while others affect any brand selling in a particular state. As different states continue developing their ESG initiatives, staying informed about changing regulations will be an essential part of sustainability decisions.
Global Sustainability Initiatives
Outside of the United States, many countries are pushing ahead in the quest to meet climate goals. From the UN’s Sustainable Development Goals to a host of new and emerging regulations in the European Union, sustainability plays a vital role in the global economy.
For international brands, this means that changes in United States policy have less impact on sustainability decisions. To comply with international standards, these companies must stick to—and, in some cases, even expand—their ESG commitments.
Policy Whiplash
The constant uncertainty of the current US landscape strains consumers, citizens, and companies alike. Policies and practices are implemented one day and changed or removed the next.
This whiplash effect creates anxiety and stress across the board and can exhaust even the most conscious individuals. Because of this, we can expect not only a generally lower commitment to sustainability but also a high likelihood of decisions changing after the fact.
Retailer Sustainability Goals
While some major brands have admitted to falling short of initial targets, many continue to make environmental and social responsibility a focus.
For example, Target’s current sustainability strategy states that, “by 2025, Target plans for 100% of our owned brands, in addition to our owned brand limited-edition and brand partnerships, to adhere to Target’s already established sustainability standards.”
Similarly, Walmart’s sustainability strategy includes 2025 goals like making 25% of global private brand packaging from recycled content and implementing reusable, recyclable, or compostable packaging for 100% of owned-brand products.
Some retailers have robust sustainability requirements for suppliers. Others may not mandate sustainability but have incentives for brands that go above and beyond in ESG. Sustainability remains a key differentiating factor for brands looking to be carried by these retailers.
Growing Pressure from Consumers
In recent years, customers have shown an increased awareness of sustainability issues and demand for conscious products. While economic uncertainty has driven more consumers to low-cost alternatives like Temu and Shein, many customers still cite sustainability as a central buying factor.
In a 2025 survey of 2,016 customers by Shorr, 90% of respondents said they would be more likely to buy from brands with sustainable packaging, and 39% said they had switched to a competing brand because of conscious packaging options.
Source: Shorr Packaging Corp
Customers are also increasingly likely to consider ethical sourcing and labor values, deforestation, and social impact when buying. This is particularly true for Millennial and Gen Z shoppers, who have significant spending power.
These trends combine to create a complex landscape for sustainability decisions, one that has generated a wide range of responses from companies, large and small.
Source: Unsplash
Companies That Are Walking Back or Eliminating ESG Goals
While this year’s political changes have spotlighted ESG issues, the past 18 months have also seen some companies abandon their previous sustainability goals.
These changes may be due to policy shifts, economic uncertainty, or a lack of progress toward ambitious targets.
Companies that have distanced themselves from sustainability efforts include:
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Financial Institutions: In February 2025, Wells Fargo eliminated its goal to achieve net-zero emissions across its portfolio by 2050. Other financial institutions like Barclays, NatWest, and BlackRock have also abandoned carbon commitments or climate targets.
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Food & Beverage Brands: In late 2024, Coca-Cola and Nestle dramatically changed their sustainability targets. Coca-Cola eliminated its goal to divert 3.3 million tons of virgin plastic waste by 2025, scaled back recycled content use goals from 50% to 30-40%, depending on the material type, and pushed back initiatives to create refillable bottles to 2035.
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Retailer SBTi Removals: Major retailers, including Unilever, Walmart, and Amazon, had their long-term net-zero commitments removed by SBTi due to a lack of meaningful progress. Despite this removal, all three retailers have maintained their near-term targets.
None of these companies was actually making strong progress toward their stated goals. Brands like these may see the current landscape as an opportunity for an “easy out,” allowing them to dismantle or scale back sustainability goals with less fear of pushback. As the current administration pressures companies to avoid ESG measures, more brands may rethink their efforts.
Source: Unsplash
Companies That Are Staying Strong With Sustainability Commitments
Meanwhile, other companies have remained committed to their sustainability goals despite mounting pressure and uncertainty.
Many of these brands have already established themselves as leaders in the sustainability space and have continued to make the environment a key focus in their business decisions.
Some recent sustainability efforts from well-known brands include:
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Patagonia: Patagonia committed to using 100% renewable energy across its supply chain, aiming to achieve full adoption by 2025. The company also adopted a new policy to ensure the ethical sourcing of raw materials, such as wool and cotton.
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Starbucks: Starbucks recently appointed a new Chief Sustainability Officer, Marika Sine, who has shared her vision to push ahead on goals like creating eco-friendlier stores, prioritizing regenerative agriculture in sourcing, and reducing waste.
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Apple: Apple is continuing to pursue its goal of making all products carbon neutral by 2030 and reducing carbon emissions through 2050. The company is also expanding its use of clean energy in its operations and supply chain.
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Walmart: The company recently released an updated circularity and ESG guidebook, reaffirming its goals to reduce waste, improve sustainability, and optimize packaging.
Business sustainability surveys also show positive trends from many companies. Most surveyed C-Suite executives still consider ESG vital and continue to consider sustainability investments as key to business success.
Some industry leaders feel that sustainability innovation will increase rather than decrease as tighter budgets and other constraints spark the need for creativity. Intentional commitments and meaningful implementation can lead to a new era of sustainable growth, despite continued challenges.
Interestingly, many financial professionals stated they see sustainability as a cost decision rather than a value-based decision and are making moves based on short-term priorities in addition to long-term growth. Despite this shift, one study showed that more than 75% of surveyed CFOs expected to increase their sustainability investments, even following the presidential election.
Source: Kearney
While more prominent brands may receive the most notable attention from the media, sustainability efforts by smaller companies remain just as important. Small brands are often well-poised to form meaningful relationships with customers, engaging them in their mission and inspiring them to action. Smaller brands may also be able to leverage their adaptability to take the leap on innovations more easily.
Even in an era of uncertainty and change, holding onto sustainability goals remains a smart strategic move for businesses of all shapes and sizes.
Source: Unsplash
Why It’s Still a Smart Move to Focus on Sustainability
There is no set of cookie-cutter rules that apply to all consumers or brands. For some, sustainability is a high priority, while for others, the environment is low on their list of concerns.
That being said, we believe that many customers, investors, and stakeholders are increasingly conscious of the impact businesses have on the planet.
For brands that have built their strategies around doing good, we maintain that it is more important than ever to adhere to—and even strengthen—their commitments to responsibility, transparency, and sustainability.
Most of our EcoAllies fall under this umbrella, and we’re here to help you navigate the balancing act of running a business and staying true to your impact goals.
We recognize that many brands are working to manage costs and deal with mounting pressures. However, we emphasize that drastic changes to sustainability efforts will (a) take away a key brand differentiator in a highly competitive landscape and (b) could lead to criticism from customers and stakeholders.
While there isn’t an easy one-size-fits-all answer, several factors make sustainability worth sticking to.
Stay Ahead of Global and State Compliance
As governments worldwide continue to refine policies related to environmental protection and corporate responsibility, companies that adopt sustainable practices early will have a competitive edge.
Compliance with emerging regulations can often be complex, mainly when requirements vary between states and countries.
However, proactively implementing sustainable measures—such as conscious packaging, sustainable sourcing, and transparent labeling—can help your brand avoid last-minute adjustments and position your business to meet future requirements with minimal disruption.
Rather than waiting for federal policies to change, businesses can take control by setting their own environmental goals. This forward-thinking approach minimizes risks and reduces future headaches, even as sustainability legislation evolves.
Stand Out to Conscious Customers
Today, many conscious consumers feel powerless. With a lack of support for environmental initiatives from governments or mainstream companies, those who see the climate as a core issue face frustration and discouragement.
For these customers, “voting with their dollars” and supporting responsible businesses gives them a way to feel a sense of control and contribute to positive change. Conscious shoppers will search for trustworthy brands, particularly those committed to authentic, transparent sustainability efforts.
Brands that stay the course with sustainability can attract these conscious consumers and engage them to become loyal supporters.
Differentiate From Competition
Sustainability can be a powerful tool for differentiation in a crowded marketplace. A growing number of low-cost retailers and marketplaces are becoming increasingly popular. Even as tariffs are imposed, these low-cost options will continue to be much cheaper than consciously made products.
Some companies are slashing expenses and changing practices to try to compete. Many customers will opt for cheaper options like Shein, Temu, and Amazon, there are also many consumers searching for something better.
A strong differentiator is a commitment to sustainability and everything it entails, from ethical sourcing to producing quality goods to designing for a responsible end-of-life. As your brand establishes a reputation as a conscious business, you’ll be able to stand out from the sea of low-cost, low-quality options.
Reduce Long-Term Operational Costs
Focusing on sustainability can lead to long-term cost savings. By adopting eco-friendly practices, businesses can reduce energy, materials, and waste expenses.
For example, investing in energy-efficient technologies or transitioning to renewable energy sources can lower utility bills. Implementing waste-reduction strategies and using sustainable packaging can also cut costs tied to raw material usage and disposal.
Sustainable practices also help businesses manage supply chain risks, reducing the impact of resource scarcity and price volatility. Over time, these measures improve operational efficiency and protect the business from future cost increases.
Strengthen Brand Image and Value
A brand that champions sustainability is viewed as more trustworthy, responsible, and future-oriented. These qualities significantly impact brand image and overall brand value. Consumers increasingly gravitate toward companies they believe do their part for the environment and society.
When your business integrates sustainability into its core values, it shows that you care about more than just profit. This alignment with social and environmental causes strengthens your brand's narrative and creates a positive public perception.
Another benefit of a strong sustainability profile is a greater margin for a premium pricing strategy since many customers are willing to pay more for products that contribute to a healthier planet.
Align With Global Trends
Even if some US sustainability efforts falter in the coming years, the global stage will continue to see climate action as a major player.
From international agreements like the Paris Climate Accord to local legislative changes, businesses are increasingly expected to contribute to the fight against climate change and environmental degradation.
Staying ahead of these global trends will allow your company to remain relevant and in tune with global consumer expectations and compliance requirements.
Attract Investor and Stakeholder Support
As the focus on ESG criteria intensifies, companies prioritizing environmental, social, and governance issues are viewed as less risky and more aligned with long-term growth opportunities.
Despite challenges, the market for sustainable investments remains strong. A US Sustainable Investment Forum survey showed that 79% of respondents expected the ESG investment market to grow stronger over the next 1-2 years. Additionally, 70% of respondents stated that they were either maintaining or expanding their impact or sustainability-based investments.
By implementing sustainability into your business model, you signal to investors that you are not only reducing environmental risks but also positioning your company for future success in a green economy.
In addition to attracting investors, sustainability efforts can strengthen relationships with other important stakeholders, from regulators to employees. This can help fuel your brand’s growth and increase your resilience amid challenges.
Source: Unsplash
Navigating Sustainability Decisions as a Conscious Brand
In a world where environmental issues are only becoming more pressing, adopting green strategies isn't just a passing trend - it’s a vital part of building a future-proof business.
Even as national policies and discourse related to sustainability shift to a more negative and dark place, we believe that demand for transparent and ethical businesses will only grow within the consumer base that is already eco-oriented in its decision-making.
As you work to create an ongoing, effective sustainability strategy:
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At a minimum, maintain your current sustainability goals. Even if you’re not in a position to do more, don’t settle for doing less. Scaling back your goals signals to consumers that your brand’s strategy is driven by the political landscape rather than by your own deeply held values.
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Wherever possible, level up your sustainability efforts. Despite uncertainty and challenges, we consider this a great time to expand your brand’s commitment to sustainability. As consumers feel disconnected from policies, many will gravitate toward brands that can help them create a positive impact. You may implement new efforts like:
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Introducing a new eco-innovation, such as cutting-edge fabrics, Algae Ink or Sway films, or reusable/refillable packaging models.
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Increasing the recycled content in your products or packaging.
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Establishing a take-back, repair, or lifetime warranty program for your products.
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Engaging in community efforts to create positive change.
Patagonia is a shining example of this principle. For years, they have followed a consistent pattern: when the world gets darker or anti-sustainability sentiments increase, they climb higher in their commitments to do good. This has not only been a boon to the planet but also to their customers and brand.
As you pursue greater sustainability, your brand will benefit from:
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Staying current with political updates and policy changes
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Keeping on top of sustainability legislation such as EPR
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Understanding what applies to your brand based on factors like your location and revenue
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Implementing enhanced data collection for areas like packaging volumes or carbon emissions
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Auditing your supply chain to identify sourcing risks, labeling gaps, or areas of potential concern
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Refreshing your packaging to ensure you are using resources efficiently and aligning with sustainable best practices
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Setting goals that are clear, measurable, and achievable rather than vague or overly lofty targets
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Communicating your efforts to customers in a transparent, meaningful way
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Considering partnerships with a cause or organization to elevate your impact
EcoEnclose is here to help throughout your brand’s sustainability journey. Whether you’re looking to update your packaging to better align with your values or need individual guidance on evolving compliance needs, we’re here as a trusted partner.
You can reach out to us for more information or explore helpful resources below.
Additional Resources:
About EcoEnclose
EcoEnclose is the leading sustainable packaging company that provides eco-packaging solutions to the world’s most forward-thinking brands.
We develop diverse, sustainable packaging solutions that meet our rigorous research-based standards and customers’ goals. We drive innovative packaging materials to market and consistently improve the circularity of existing solutions.
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