Blueprints for Sustainability: Unmasking ESG Trends in Modern Infrastructure

With 2023 drawing to an end, we wanted to share the most relevant ESG controversies during the year. In this article, we provide a comprehensive overview of the year's top ESG controversies, breaking them down into the three pillars of ESG: Environmental, Social, and Governance. Through our research, we will explore each of these areas in detail, shedding light on the most talked-about controversies and the companies involved.

Methodology

To gain a comprehensive understanding of the ESG risks in 2023, we conducted a thorough analysis of web mentions related to SESAMm’s ESG taxonomy across our expansive data lake with 20B+ articles. This allowed us to evaluate the overall volume of mentions related to each risk category: Environmental (E), Social (S), and Governance (G).

ESG Risks Over Time

Before diving into the details, we looked into the main trends over the last few years in ESG trends. We found a detectable increase in the volume of ESG-related web mentions, with an emphasis on social risks. Especially since the start of 2020, social risks have been on a consistent upward trajectory. Notably, there was a significant spike in mentions around mid-2020 following mass protests amid the COVID-19 lockdown, in addition to reports of cyberattacks and allegations of sexual assault. Furthermore, 2021 saw an uptick in mentions related to issues of racism (Black Lives Matter movement) and homophobia.

ESG Risks: Focus 2023

We outlined the prominent risks in 2023: social risks, with layoffs and strikes gaining attention; environmental risks, marked by wildfires and oil spills; and governance risks, where tax evasion and ethical violations like bribery were in focus. Each risk category underscores the urgent issues facing society and the need for accountability and action.

Environmental Controversies of 2023

Environmental risks may not match the sheer number of mentions that social risks receive, but their presence in discussions has steadily grown over the year, particularly in the third quarter. Let's explore the most common controversies that have emerged.

Climate Change and Policy

Climate change dominated environmental discussions in 2023. A noticeable peak in mentions arose in the latter half of the year, particularly around heatwaves and debates surrounding climate policies.

Atmospheric Emissions

September saw increased discussions about atmospheric emissions, notably due to the emissions from volcanic eruptions,  hybrid cars, and the discovery of toxic metals in food products.

Impact on Biodiversity

The wildfires that spread in June sparked significant debates around their impact on biodiversity, leading to increased mentions and concerns related to environmental preservation.

Top 5 Environmental Controversies

These controversies are ranked by relative volume*.

• Marathon Petroleum
  

Volume of mentions: 62

Relative volume: 69%

A significant portion of environmental risk discussions surrounding Marathon Petroleum was due to its chemical leak in Garyville. This incident led to massive fires, so large they could be observed from space. (source)

• Nestlé
  

Volume of mentions: 30

Relative volume: 54%

Nestlé faced scrutiny in 2023, with over half of its environmental risk mentions associated with drought controversies. The company was urged to cease its water mining activities following severe droughts in France. (source)

• Coca-Cola
  

Volume of mentions: 178

Relative volume: 53%

Coca-Cola garnered attention due to a hydrochloric acid leak in January 2023, leading to significant environmental concerns. (source)

• ExxonMobil
  

Volume of mentions: 571

Relative volume: 31%

Exxon, along with Guyana’s environmental agency, was implicated in breaches of oil spill insurance policies. (source)

• Shell
  

Volume of mentions: 872

Relative volume: 23%

An oil spill from a Shell pipeline adversely affected farms and a river in a region of Nigeria already grappling with pollution. (source)

Social Controversies of 2023

Social risks have taken the forefront in 2023, with notable web mentions increasing significantly. Here are the most relevant controversial topics:

Social Dialogue

Social discourse intensified at the start of the year, with news of widespread strikes in various sectors, including aviation and education, primarily driven by pay disputes. The wave of layoffs in several tech companies was the talk of the town, especially during the first quarter of the year.

Respect for Human Rights

The year saw an uptick in mentions related to human rights, especially controversies surrounding racism, data privacy violations, sexual harassment, and breaches of GDPR.

Diversity and Inclusion

Discrimination against minority groups, including the LGBTQ community and people of color, and age-based discrimination became a significant topic of discussion in 2023.

Top 5 Social Controversies

These controversies are ranked by relative volume*.

• McDonald's
  

Volume of mentions: 8,903

Relative volume: 87%

McDonald's faced substantial social risks in 2023 due to significant layoffs of its corporate staff in April. The move led to public concern and discussions around the company's employment practices and stability. (source)

• Google
  

Volume of mentions: 13,504

Relative volume: 43%

Google found itself in the spotlight as it faced challenges related to major layoffs in January and October of 2023. These layoffs contributed to almost half of the social risk mentions associated with the tech giant. (source)

• Meta
  

Volume of mentions: 10,965

Relative volume: 38%

Meta, formerly known as Facebook, also faced scrutiny as 38% of the company's social risk mentions revolved around layoffs that took place in March and October 2023. (source)

• Microsoft
  

Volume of mentions: 6,060

Relative volume: 28%

Microsoft faced challenges due to disruptions caused by cyberattacks in early June. In addition, the company had to navigate through controversies related to layoffs, contributing to its social risks. (source)

• X (formerly Twitter)
  

Volume of mentions: 7,246

Relative volume: 8%

X/Twitter experienced a global outage, which was followed by significant layoffs. These events led to considerable public discussions and social risks for the company. (source)

Governance Controversies of 2023

Governance risks, though often overlooked, play a pivotal role in shaping corporate responsibility and ethical conduct. In 2023, several governance controversy trends emerged:

Money Laundering

Tax evasion was a major topic of discussion in the first quarter, highlighting the need for greater transparency and accountability within corporations.

Bribery

There was a significant increase in mentions related to bribery cases, underscoring the challenges in maintaining ethical governance standards.

Competitive Behavior

This year has witnessed a rise in competitive conduct controversies, with several companies being scrutinized. Antitrust violations, price manipulation, and digital advertising dominance are central to these disputes.

Top 5 Governance Controversies

These controversies are ranked by relative volume*.

• FTX
  

Volume of mentions: 8,085

Relative volume: 40%

FTX, a notable entity in the financial sector, found itself at the center of governance controversies. A significant portion of the discussions surrounding FTX's governance risks in 2023 pertained to allegations of its founder's involvement in bribery schemes. (source)

• Apple
  

Volume of mentions: 3,162

Relative volume: 28%

Apple, a tech giant, faced scrutiny as a third of its governance risk mentions revolved around antitrust violations reported in October 2023. (source)

• Microsoft
  

Volume of mentions: 4,429

Relative volume: 25%

Microsoft encountered legal challenges with its deal with Activision. The company had to approach the court to reject the FTC's request to halt the deal. (source)

• X (formerly Twitter)
  

Volume of mentions: 2,251

Relative volume: 18%

X/Twitter, another major player in the tech industry, faced legal challenges when a judge dismissed a shareholder lawsuit against Elon Musk concerning a Twitter buyout. (source)

• Google
  

Volume of mentions: 3,920

Relative volume: 13%

Google faced judicial sanctions for allegedly destroying evidence in an antitrust case, further emphasizing the critical governance challenges even major tech giants face. (source)

Conclusion

In conclusion, the year 2023 proved to be eventful in the ESG landscape. From environmental concerns sparked by significant events like chemical leaks and wildfires to social challenges such as widespread layoffs and discrimination and governance risks underscored by bribery and antitrust violations, the year offered a comprehensive view of the myriad challenges companies face in the modern era.

Understanding these controversies and the companies involved provides invaluable insights for stakeholders, especially in the private equity and asset management sectors. AI-driven ESG insights, like those provided by SESAMm, can be pivotal in navigating the ever-evolving ESG landscape, ensuring informed decision-making and proactive risk management.

Relative volume*: Relative to the total volume of E, S, or G risks for the company during the same period.

SESAMm’s AI Technology Reveals ESG Insights

Discover unparalleled insights into ESG controversies, risks, and opportunities across industries. Learn more about how SESAMm can help you analyze millions of private and public companies using AI-powered text analysis tools.

Imagine finding out you've run out of milk immediately after pouring a bowl of cereal. Or maybe realizing you don't have eggs while in the middle of baking a cake. We've all been there, and it's frustrating, to say the least. And this scene has been playing around the globe over the last couple of years for many foods and products. One day it's microchip shortages, and the next, it's baby formula.

Unfortunate as it is, it's one thing for consumers to cope with an empty car lot because of chip shortages. It's another to cope with a hungry infant because store shelves that once contained baby formula are now bare. For those parents and caretakers, their emotions are beyond feeling frustrated. They feel anger and panic, the sort of emotions that they share with their friends and colleagues on social media and forums. The kind of expression that can change the public's sentiment about a company, which in turn can move markets.

This Alternative Data Trends post will examine web data concerning the baby formula shortage. We'll analyze articles, social media, and forum conversations culminating in the U.S. crisis as the news reaches national exposure. We'll also highlight red flags investors could've seen had they monitored the situation with an AI-powered text analysis tool like SESAMm's TextReveal®.

Early warnings: When baby formula supplies began to run dry vs. when it became a national crisis

If we compare absolute and relative volumes—relative being mentions about the topic compared to our entire data lake—the term "formula milk market" yields parallel results. Mentions spike in May when the crisis reaches national coverage (see Figure 1).

However, comparing absolute and relative volumes for the term "formula milk shortage," we find red flags as early as January 2022, four months before the crisis receives national attention (see Figure 2). Relative mentions spike on three occasions before absolute volumes register any significant noise. The fourth instance matches a ripple on the absolute chart.

These articles provide an example of the content published around the times of those rises in mentions:

1. Jan. 12, 2022: "Baby Formula Is Hard to Find. Brands and Stores Are Divided Over Why.," WSJ
2. Feb. 9, 2022: "Baby formula shortage has some families scrambling," WCAX-CBS
3. Mar. 7, 2022: "Baby formula shortage and recalls affecting families," KGUN-ABC
4. Apr. 11, 2022: "A shortage of baby formula is worsening and causing some stores to limit sales," WHYY-PBS

Analyzing the sentiment and polarity of the formula milk market

In short, the e-reputation of the formula milk market has been negative since the beginning of 2022 (see Figure 3). Positive sentiment drops and reflects the opposing negative sentiment almost exactly until May, when the news about the crisis breaks. Likewise, polarity trends downward over the same period.

Note: Polarity represents a company's aggregate of positive and negative sentiment (opinions, reviews), ranging from -1 to 1. A zero score means that there is as much positive as negative sentiment. High e-reputation brands can have polarity scores of more than 0.5.

The web data shows that some articles correlate with sentiment and polarity changes. For instance, in February, AboutLawsuits.com posted, "Similac and Enfamil Baby Formula Shortages Create Infant Feeding Challenges." And in May, HealthDay, a prominent syndicator of health news, posts, "U.S. Baby Formula Shortage Worsens."

Analyzing formula milk brands

In the U.S., four brands produce the bulk of formula milk: Abbott, Mead Johnson, Nestlé, and Perrigo. Abbott and Nestlé hold the largest share of the formula milk market.

When we group these four brands' mentions from January 2021 to June 2022, we can see how their mention volumes compare (Figure 4). For example, at the beginning of the graph, we can see that Abbott and Nestlé have more mention-volume relative to their market share. However, at the end of 2021, Mead Johnson and Abbott experience spikes in mentions due to lawsuits against their formulas. Then, in Q1 2022, Abbott mentions increased drastically after its formulas were recalled due to possible contamination, taking more than 75% of the mention volume.

Analyzing ESG risks by company

Evaluating the top four brands' ESG risks reveals red flags as early as May 2021, when Abbott was fined for including a banned flavoring in its baby formula (see Figure 5). And most red flags were raised before the national shortage crisis was publicized widely.

Besides Abbott, most brands' risks remained low during 2021. However, ESG risks increase during Q1 2022 for all four major formula milk brands. The FDA warned consumers against using specific Abbott formulas during an investigation of infant illnesses possibly caused by Abbott's formulas. Perrigo settles a lawsuit from the State of California over baby formula lead levels. And a panel of federal judges centralizes many baby formula lawsuits into one federal court, including cases against Mead Johnson. Nestlé stays below the 5% threshold throughout, with little to no controversies found.

Three tactics and a summary

The baby formula market in the U.S. has been volatile for many reasons, which we won't get into in this article. However, this volatility could be seen and planned for. In this case, here are some tactics you can take to minimize your investment risks:

1. Employ a tool like SESAMm’s TextReveal to evaluate web data for insights into your investments. With premiere NLP technology, you can uncover sentiment and ESG insights about your industry, portfolio companies, or current investments.
   
   
2. Expand your research term for deeper insights. In this study, the term "formula milk market" had matching absolute and relative volumes. From this view, nothing looks out of place, and there aren't any red flags. However, when we expanded our research with the term "formula milk shortage," we found many controversies before the crisis gained national attention.
   
   
3. Dig into the controversies' causes. It's not enough to acknowledge a red flag. It would be best if you looked into what the potential reason is. Is the controversy caused by external factors or internal ones? Maybe both? Is the issue a one-time occurrence, or is it a pattern? So it's essential to avoid black-box tools. With solutions such as TextReveal that allow you to see beyond, you can access the underlying articles triggering the red flags.

Stay in touch with SESAMm

Thanks for reading this issue of Alternative Data Trends. Be sure to catch the next issue by subscribing to our blog. And if you'd like a TextReveal demo, send us a message via the form.

Held from June 21–29, London Climate Action Week (LCAW) 2025 brought together over 45,000 participants across 700+ events, emphasizing London’s role as a global hub for climate finance and leadership. As geopolitical uncertainty clouds climate ambitions, this year’s event signaled a broader market pivot: investors are now prioritizing regions with regulatory clarity and policy momentum, namely Europe and Asia.

A joint survey from Bain & Company and the World Business Council for Sustainable Development, released during the week, found that 75% of global firms now prefer to invest in Europe or Asia for climate-related initiatives. Over half reported a declining appetite for U.S.-based projects, citing inconsistent federal climate policies and rising political risk.

Policy Signals from the UK

UK Energy Secretary Ed Miliband used the event to announce a bold step forward: the government will invest £30 billion annually in clean energy infrastructure through 2035. His remarks positioned the UK as a “clean energy superpower,” with a dual focus on energy security and economic renewal.

He also outlined plans for new corporate sustainability reporting standards, a move intended to improve transparency, build investor confidence, and ensure alignment with the UK's net-zero targets. These commitments were part of the UK’s post-Brexit green industrial strategy, distinguishing it from recent ESG policy slowdowns in Brussels and Washington.

Climate Finance and Market Confidence

 One of the most prominent themes throughout the week was capital mobilization. At the “Finance Live” forum, asset managers, banks, and insurers debated how to align their portfolios with net-zero goals while navigating geopolitical instability and rising greenwashing scrutiny. Key discussions included scaling blended finance vehicles, investing in transition technologies, and strengthening ESG data governance.

Meanwhile, sessions like the Nature Hub spotlighted biodiversity and natural capital, moving beyond carbon to more holistic definitions of environmental value. This reflects a growing consensus that an effective climate strategy must include nature-based solutions and ecosystem restoration.

The Broader Message: A Shift in Global Climate Leadership

While the U.S. backtracks on core climate regulations, London and Europe are entering a leadership void. For global investors, that means that developing a climate strategy now includes not only where to invest but also where to trust. In that context, LCAW 2025 offered both policy and finance updates and a credibility reset.

The takeaway is clear: in an age of fragmented regulation and climate politicization, market trust flows towards stability. London Climate Action Week didn’t just reflect that shift; it helped define it.