2025 was the year when the world shifted dramatically away from Humanity’s pursuit of a sustainable future. How should we approach the year just starting?
A decade has passed since the year 2015, which marked the peak of multilateralism and solidarity in the planet. That year, all nations on Earth agreed in Paris to reduce carbon emissions and fight climate change. This was the very same year in which the Sustainable Development Goals framework was agreed by all nations. Everyone had a role to play - governments, corporations, NGOs and individual citizens in a universally agreed agenda for human progress. In the first five years, from 2015 to 2020, solid progress was achieved, ambitious targets and regulations were put in place and increasingly adopted, a decentralized transparency framework emerged, solidarity between rich and developing nations solidified.
In the following five years there were some strong bumps along the way. The US left the Paris agreement in 2020 under the 1st Trump administration. COVID showed that global solidarity could evaporate very quickly. The invasion of Ukraine by Russia showed we could go back to imperialist times. The attack on Israel and subsequent war in Gaza showed that blind ideology and hate could win over humanity on both sides of a conflict. Yet, these were temporary or localized setbacks, not structural or global shifts, and the pace forward for sustainability was still clear. The resolve of the European Union was strong, the US rejoined the Paris Agreement in 2021, and China started to make significant progress towards energy transition. Sustainability entered the core discussions in corporate boardrooms and increasingly influenced consumer decisions. Technological advance showed promise in several areas related to sustainability. Most notably, wind energy production reached technological maturity and solar energy production became economically efficient after years of strong economic incentives. Substantial investments followed in renewable energy production and vehicle electrification, starting to move the world economy away from fossil fuels, just as the impacts of climate change and global warming were becoming clear.
Then 2025 arrived and the shift was dramatic and structural, especially in the US. More dangerous than just Donald Trump, a new ideological movement called MAGA assumed almost complete power in the US, adopting a narrowminded American first policy that included science denial in well-established areas like climate science and vaccine safety. The US Government and US institutions rewrote 50 years of rules and practice on global engagement and coalition building.
They did not only leave the Paris agreement again. They are intent in destroying the Paris Agreement. They don’t simply contest the science behind climate change and the level of efforts that should be put in promoting sustainability. They created a non-scientific narrative that simply denies the problem exists. They don’t decide to reduce humanitarian efforts, they simply destroyed through one illegal decision - the closure of USAID - the framework in which the humanitarian industry was based. In this context, the natural alliance of liberal democracies loosely called the West is fracturing as the US leaders seem intent in building a loose global coalition of nations led by authoritarian strongmen while ditching historical allies that share liberal democratic values. China is seen as an adversary not because it is a dictatorship but because is the only nation on earth powerful enough to challenge the US.
What happened in 2025 amounts to a complete re-write of the international order globalization and multilateralism are receding and imperialism and authoritarianism are back in fashion. Hard power is driving the political and military agendas. The self-interest of rulers and nations now dominates global politics. Authoritarian leaders don’t even need to steal only when no one is watching. They have now a license to kill, steal, control, bribe, corrupt in plain sight, as if might was right. In the US, conflicts of interest are egregious, the corruption between business and politics widespread, and even the supposed sanctity of US financial markets is challenged. No one seems to care for long term value creation as long as everyone keeps making money. The only person with independence and power to regulate the market will end his mandate as president of the Federal Reserve on May 15, 2026. After that, US interest rates will likely be lower, credit will accelerate again and fuel continued speculation on financial assets and crypto “things” that don’t produce any economy value and reduce the transparency of accountability of money flows.
In this context, 2025 ended with two significant events that were reactions to the challenging context that I just described. The first was that the European Commission reviewed its plethora of sustainability regulations, limiting the scope and delaying the enforcement of the most important climate targets and disclosure requirements. It is clear that, for EU leaders and policymakers, competitiveness is now more important than sustainability. The second event was the unexpected pronouncement from Bill Gates, one of the most thoughtful and important philanthropic investors in the world, who argued that the now more limited philanthropic resources should be channelled to social and humanitarian problems and not to energy transition. His arguments are twofold – that technological advances in sustainability domains have been so strong that we will be capable of avoiding the doomsday climate scenarios. And that in a world of more limited goodwill, scarce resources should be devoted to humanitarian issues and climate adaptation strategies for which existing resources can alleviate the most human suffering.
So, as we start 2026, is sustainability as a policy and practice disappearing? Is a focus on ESG no longer relevant in the current geopolitical context of hard power and naked self-interest?
What I believe is that this is the time to be cleverly pragmatical and resolutely values-driven. Here is my 2026 list of priorities for responsible leaders, thoughtful policy makers and concerned citizens:
1. The time when we could trade-off environmental concerns for social issues is over. Further advances in environmental issues will need to come from market forces, investor interests and consumer behaviours, not regulation or new taxes. We have now evidence that, in many sectors and business areas, sustainability pays off for the 3Ps - profit, people and planet. Responsible business leaders will need to pragmatically identify the many opportunities and invest in them. Sustainability needs to be embedded in corporate boardrooms and management practices in the same way that quality management became embedded in business practices in the 90s. It is just the right and profitable way of doing business. Let’s now focus on the business case for sustainable action.
2. 2026 is the critical year for citizens to express their concerns and choices. Not in dramatic demonstrations in favour of environmental causes or equality goals, but by everyday decisions of what they consume, for whom they work for, what causes they support with their time and money, what behaviors they engage in, what ventures they build. A sustainability, care and circular economy mind-set needs to be embedded in the everyday life of citizens, and the burst of innovative impact oriented ventures should continue to bring new solutions to build a better world.
3. The humanitarian sector should focus on social issues tied to the basic needs of people for food, health, education, safety and human rights. The new fragmenting global order will create a double problem – fewer resources for humanitarian causes and more situations of war, conflict and exploitation where human suffering and vulnerability will increase. This needs to be the main focus of humanitarian action.
4. In this context, the priority governments and policy makers should be… not environmental issues, not social issues, but governance. In a fragmenting world where “might seems to be right” we need to be completely clear on ethics, values, science-based decisions and good governance. That is the key to align global good will and find solutions to global problems. The EU, in particular, because of its economic power and moral influence, needs to have very strong value-based policies and exercise zero tolerance against corporations, citizens and forces that do not abide by them. The law should be a safeguard of rights of citizens and companies and not used as a tool to enforce power. Strong support and financing of independent scientific developments should be implemented, because science is the key for progress and good decisions. Rules to prevent conflicts of interest, corruption and bribes, or abuse of power should be enforced and punished with legal action and the loss of access to EU markets or European financial resources for those who do not follow them. Disinformation should be combatted with resolve. Digital sovereignty should be implemented in the EU. Human rights violations should be identified and fought back, no matter how powerful the violators are. It is time to step back from ideological agendas and go back to basics, drawing clear boundaries based on ethics, values, and good governance. In 2026 sustainability is not dead and ESG is not over – both need to be embedded in everything we do. This is the time to be principled, this is the time to be brave.
This is the time when values matter the most. The time when sacrifices may need to be made for a greater good, so that we are proud of the world that we are building.
Have a great and impactful week!
Filipe Santos, Dean at Católica Lisbon School of Business & Economics