Accelerating in Neutral: A Critical Analysis of ESG and DEI Self-Sabotage

By Daniel R. Schnaider, Co-Founder & CEO, Wisefy, Brazil

September 6, 2024

What is essential is invisible to the eye.” Antoine de Saint-Exupéry (from The Little Prince):

I understand the importance given to ESG (Environmental, Social, and Governance) and DEI (Diversity, Equity, and Inclusion). However, I believe that these concepts are counterproductive to their own goals. The issue largely lies in the general public’s misunderstanding of correlation and causation. This article aims to clarify this matter and help society stay focused on what truly matters.

It’s different to say that: a lack of diversity is a problem and, therefore, needs to be addressed as soon as possible, compared to claiming that the climate crisis is an existential threat to humanity and that solving it requires diversity.

In the first scenario, we identify a secondary problem and treat it as the primary goal; increasing diversity does not guarantee a solution to the primary issue. In the second, we identify the primary problem, and because it’s so complex, we realize that we need all the best minds humanity has to offer to solve it—regardless of their race, birthplace, ideology, or religion.

Take ESG, for instance. The “E,” which represents environmental challenges, is a massive priority in global terms, while “S” and “G” (social and governance) become merely dust in this context. Let me be clearer: imagine a world where the darkest predictions of climate change come true—entire cities submerged, millions of climate refugees wandering aimlessly, crops destroyed, and healthcare systems overwhelmed. In this apocalyptic scenario, sustainability (S) and governance (G) initiatives become insignificant in the face of the environmental disaster (E).

When natural resources are scarce, and basic infrastructures collapse, the priority is no longer workplace diversity or corporate transparency. The chaos and fight for survival expose the fragility of our social and governmental structures, showing that without a stable environment, the foundations of human progress crumble.

The impact of “E” overshadows everything to the point where it transforms entire societies into a state of permanent emergency. Governments collapse, unable to cope with simultaneous crises—from a lack of drinking water to the spread of diseases. Social cohesion dissolves as communities fiercely compete for increasingly scarce resources. Thus, the environment (E) doesn’t just affect the social (S) and governance (G) dimensions—it obliterates them. Without a healthy planet, there’s no foundation for social justice, nor governmental structures capable of maintaining order and prosperity.

As we confront the imminent environmental catastrophe, other global challenges also threaten our existence in equally devastating ways. In a world where resources are extremely limited and social inequalities are worsening, discrimination and exclusion are intensifying. Extreme poverty affects more than 700 million people, condemning them to hunger, disease, and a lack of access to basic necessities. Minorities and vulnerable groups, already at a disadvantage, face even greater hardships.

Additionally, other issues such as cybersecurity pose critical threats, with attacks capable of leaving entire cities without water and electricity, paralyzing societies. Space wars could destroy satellites essential for communication and navigation, while the threat of a nuclear bomb in the hands of terrorists becomes increasingly real.

Disinformation fueled by artificial intelligence can destabilize democracies and cause social chaos. Geopolitical crises threaten to end global order and unleash devastating conflicts. The disruption of supply chains could lead to economic collapse, while the end of free markets and democratic systems threatens global freedom and prosperity. Rising public debt and pandemics, like COVID-19—which killed millions—expose our vulnerability.

When the environment (E) collapses, these problems intensify exponentially. Without a habitable planet, debates about sustainability (S), governance (G), and DEI become irrelevant, as humanity will be fighting just to survive. If we focus on the right priorities, we will consequently achieve better outcomes in ESG and DEI. Otherwise, what seems bad today may, in hindsight, look like heaven in the years to come.

To save nature, along with other paramount challenges for humanity, we need a new model of governance—something oriented to specific tangible results. I believe we need GOD, or “Genesis-Oriented Democracy.” This concept—which I propose and explain in this article—represents the beginning of a democracy that not only reacts but proactively creates a better future for all.

The time to act is now. Without a new “Federalist Papers” (the well-known series of articles from the 1787 Philadelphia meetings that led to the ratification of the U.S. Constitution), which prioritizes not only values like freedom, democracy, and capitalism but also concrete indicators that measure outcomes such as reducing global temperatures and preserving the environment, we’ll merely be ‘accelerating in neutral’—making noise and smoke, but going nowhere.

Our future guides us over numerous bridges that must be built wisely. My colleagues and I, along with many global leaders, look forward to welcoming you to the Horasis Global Meeting on October 25-26 in Vitória, Brazil, where we will discuss how we can overcome the challenges of these new constructions.

Daniel R. Schnaider, Co-Founder & CEO of Wisefy AI Powered Supply-Chain

Photo Credit: OpenAI Dall-e