Few topics in corporate America are as politically charged as ESG (environmental, social, governance). Once a relatively unknown framework used by investors and risk professionals, ESG has become a cultural flashpoint. Depending on who you ask, it is praised by some as essential to modern business, derided by others as corporate virtue signaling or pulled into a highly charged political debate far beyond the boardroom.

In the world of sports, where global audiences, massive sponsorship dollars, and fan passion intersect, the debate over ESG is more than rhetorical. The issues it represents are already shaping strategic decisions, sponsorship valuations, risk profiles and reputational outcomes. The question for sports organizations, sponsors and corporate partners is not whether they like ESG, but whether they can afford to ignore it. Increasingly, the answer is no.

ESG is already embedded in sports strategy, even when it doesn’t work

In elite sport, environmental, social and governance issues surface at every major event. When ESG commitments fall short, the consequences are immediate and visible.

For example, the Tokyo 2020 Olympics, which was positioned as a “sustainable” Games following its pandemic-related postponement, ultimately drew significant criticism over environmental and labor issues tied to venue construction. Deforestation around event sites and reports of extreme overtime for construction workers contradicted sustainability promises, sparking public backlash from........

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