Greenhushing as Strategic Adaptation: Net‐Zero Commitment Retreat Among S&P 500 Firms Amid Environmental, Social, and Governance (ESG) Backlash

ABSTRACT Greenhushing has emerged as a strategic corporate response to political and regulatory uncertainty, yet less is known about how firms recalibrate previously established sustainability signals when external conditions change. Drawing on signaling theory, this study examines changes in corporate climate and ESG commitments during the political transition to the second Trump administration. Using qualitative content analysis of corporate disclosures and public communications, we identify 32 large US firms that modified, weakened, or withdrew previously stated commitments between September 2024 and August 2025. Among these firms, 13 (41%) were associated with political or regulatory pressure, 8 (25%) linked changes to rising AI and data‐center demand, and 11 (34%) pointed to profit‐driven refocusing, market uncertainty, or broader regulatory ambiguity. The findings reveal clear sectoral differences in how firms recalibrated sustainability signals. Financial institutions exhibited the most direct and visible retrenchment, particularly through withdrawals from net‐zero alliances and changes in ESG‐related communication. Technology firms more often retained long‐term climate commitments while reducing the visibility, prominence, or certainty of interim targets. Other sectors showed less visible but still consequential forms of retreat, including target modification and the Science Based Targets initiative (SBTi) delisting. Case studies of BlackRock, Meta, and Microsoft further identify three distinct pathways of greenhushing: politically induced retrenchment, selective undercommunication amid rising emissions, and more cautious or conditional sustainability signaling in response to reputational and regulatory risk.