Welcome to another week of Shaken Not Burned! 

This week, we are talking about the turbulence surrounding ESG and sustainable finance. The question we’re exploring: is the backlash against ESG a crisis, or a necessary correction?

Joining us is Professor Thanos Verousis, an economist and researcher on sustainable finance at Vlerick Business School. Together, we unpack why ESG is under fire, what went wrong, and how finance can evolve to meet the challenges of the 21st century.

It is tempting to see ESG as the future of finance or to dismiss it entirely as a failed fad. But as Thanos explains, ESG was never meant to be the system. It is a measurement tool. Sustainable finance requires something deeper: transparency, regulation, and a willingness to grapple with real trade-offs.

The discussion covers the tension between financial returns and social trade-offs, how a narrow financial definition of fiduciary duty is shifting to include climate and social concerns, why alliances often stall, and how ESG is interpreted differently globally.

As Thanos puts it: “Sustainable finance will only mature when we are honest about trade-offs, transparent in pricing externalities, and inclusive of those not yet at the table.”

ESG hype was bound to face correction: by reframing this moment as a sustainability correction, finance has a chance to rebuild on stronger, more resilient foundations.

Reading materials:

• European Central Bank’s Sustainable Finance Strategy

• ECB on why the benefits of an orderly transition outweigh its cost

• Principles for Responsible Investment’s Guidance on fiduciary duty

• Carbon Pricing Leadership Coalition: Case studies and data

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