Modern Warfare and Its Effect on ESG Implementation
Given the current geopolitical tensions worldwide, we have uncovered a significant gap in integrating Environmental, Social, and Governance (ESG) frameworks in conflict zones. These frameworks were designed to be addressed through corporate negotiations and boardroom discussions. Typically, regions most affected by climate change are also those most embroiled in conflict, such as the Sahel, Sudan, and ongoing instability in the Middle East, which disrupt ecosystems, replace corporate governance with shadow military economies, and overshadow the overall ESG economic goals.
Gradual pollution and emission patterns resemble war and conflict in the environmental damage they cause in such a short period. From hardware manufacturing to logistics, and the financial and social costs, all reflect advanced degradation accomplished quickly. Ecocide is a term derived from the effects of war on ecosystems.
Large-scale destruction of entire ecosystems, as seen in Sudan and the Gaza Strip, demonstrates the toll of war on the environment, with entire communities, forests, and parks razed. In Sudan, pipelines and refineries have been targeted in areas like Port Sudan, increasing the risk of water contamination in the Indian Ocean and surrounding regions. This hampers energy transitions in resource-rich areas such as the Democratic Republic of the Congo (DRC) and Libya, and slows down efforts towards economic and financial inclusion aimed at fostering a net-zero economy.
A major impact of war is the displacement of people. Displaced communities often live in shadow economies where labour and human rights are ignored, and poor individuals are bypassed due to the lack of proper structures. In Eastern DRC, illegal mining presents a significant problem – poor techniques, inadequate gear, safety issues, and lack of oversight lead to accidents, child exploitation through forced labour, and limited access to better returns.
The lack of inclusive economic policies in war-torn countries such as Sudan leads to greater gender discrimination, reversing pre-war efforts to address it. In these regions, creating compliance or due diligence frameworks becomes nearly impossible, as companies implement them minimally or not at all. The social consequences go beyond investment or labour markets, impacting the very fabric of society. Attacks on heritage, education systems, or healthcare infrastructure leave entire generations with diminished workforce capabilities and obstruct long-term human capital development.
Governance is fundamentally challenged by ESG issues in conflict zones. Mechanisms such as transparency and regulatory compliance systems are often absent in war-torn areas. War economies, like in Sudan, channel all their resource gains into sustaining conflict and as bargaining tools. In DRC, militias have taken control of the mining trade, hindering local development. Conflict financing should be closely linked to corruption and genocidal intentions, rather than being overlooked. Such illicit revenues cannot be tracked through standard audit procedures due to the covert operations of militias or factions in these regions. However, national security is a public good and should also protect democratic processes and social institutions.
As conflict exposes the limitations of sustainability and affiliate structures, regional bodies and governance frameworks should concentrate on strengthening broader objectives. By financing infrastructure such as renewable systems that remain operational during conflict, we improve resilience and reduce reliance on carbon-intensive energy needed in such times. Investing in initiatives aligned with the United Nations Sustainable Development Goals (UN SDGs) will help us recognise that all ESG frameworks support a commitment to social and economic growth.
In an era of conflict and heightened tensions, we should focus on the impact of climate stress on human capital, invest in corporate frameworks that remain effective even during war, and assess whether the structures surrounding ESG are resilient in the face of any form of geopolitical turbulence.
