‘Not the best idea’: Workday co-CEO Aneel Bhusri doesn’t like the SEC’s effort to measure and regulate ESG

Will political attacks on ESG cause companies to pull back from social and environmental commitments? I was in Florida yesterday—ground zero for the attack on “woke” CEOs—and asked that question of Workday co-CEO Aneel Bhusri, who is hosting his company’s massive annual customer event there. It was a table-turner for me—Bhusri was interviewing me about my book Tomorrow’s Capitalist in front of a group of senior executives. But I managed to slip my question into the conversation. His response:

“I believe in the narrative of environment, social, and governance. I think these are three important things for companies to focus in on. It’s part of stakeholder theory.

“I’m not a fan of the ESG construct, because it seems like a catchall. I’m not sure how those three things came together. The SEC is now looking to measure and regulate it. I think that’s not the best idea…

“But I don’t think it will cause companies to pull back. I think what it will do is drive better clarity around…the outcomes we are looking for.”

Ellen McGirt and I had a similar conversation with Lynn Martin, president of the New York Stock Exchange, as part of this week’s episode of our podcast, Leadership Next. Her response:

“I think people have different opinions [about ESG investing]. Some think it’s good, some people think it’s not good…But I think [it’s] here to stay in investing strategy. It’s an area of focus for every CEO, every CFO, I talk to. Investors that have a specific ESG lens are continuing to ask public companies for more information. I think what’s going to be most important is ensuring that information is bulletproof.”

You can listen to the entire podcast on Apple or Spotify.

By the way, Martin is one of several hundred extraordinary female leaders who will participate in Fortune’s Most Powerful Women Summit Oct. 10–12 in Laguna Niguel, Calif. Others include: philanthropist Melinda French Gates, Rep. Liz Cheney, Walgreens CEO Roz Brewer, TIAA CEO Thasunda Brown Duckett, Instacart CEO Fidji Simo, Accenture CEO Julie Sweet, Elevance Health CEO Gail Boudreaux, Kohl’s CEO Michelle Gass, Ancestry CEO Deborah Liu, AMD CEO Lisa Su, and more. The event is invitation-only, but you can apply for an invite here.

Other news below.

Alan Murray
@alansmurray
alan.murray@fortune.com

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This edition of CEO Daily was edited by David Meyer.