Environmental, Social, and Governance: Government leadership as a catalyst for success

The Environmental, Social, and Governance (ESG) movement has quickly evolved in the U.S. from socially responsible investing to a strategic imperative, affecting not only investment decisions and shareholders but also business strategy, the economy, and people around the world. For governments, the goal is to build long-term sustainability and achieve desired outcomes for constituents and other stakeholders.

Governments are not new to addressing environmental and social issues. However, key forces are driving the need for all levels of government—federal, state, regional, local, and tribal—to focus on ESG holistically as central to their missions. With increasing global risks, the mounting costs of those risks, heightened employee, public, and stakeholder expectations, declining trust in government, and new funding opportunities, a focus on ESG can have a profound impact on mission achievement at all levels of governments.

For more insights into the U.S. public’s and government employees’ sentiments regarding governments’ approach to ESG, in the Spring of 2022, KPMG surveyed 1,000 U.S. residents and 427 federal, state, and city government employees. The survey reveals the degree to which government employees and constituents are holding governments accountable for addressing ESG issues, their satisfaction with governments’ action on ESG, the ESG issues of most importance to them, and other important insights.