The biggest U.S. companies are weaving ESG into pay incentives despite a backlash against the use of sustainability as a metric for corporate performance. The opponents — including Republicans such as former Vice President Mike Pence — have labeled the focus on ESG a cornerstone of “woke capitalism.”

Investors have cooled to ESG goal setting, with the flow of capital into sustainable funds worldwide waning during several quarters. Such inflows fell to $13.7 billion during the third quarter from $23.6 billion during Q2, according to Morningstar. Investors during Q3 pulled $2.7 billion from U.S.-based sustainable funds.

U.S. company use of ESG metrics in pay incentives “has probably got to a point where we will see some plateauing going forward,” Kuk said, adding that “it’s hard to make sweeping comments about this, as every organization is likely making their own calculation as to how they would react to these market sentiments.”

At the same time, “for companies that already have ESG metrics in place — and some have put them in not too long ago — removing them presents bad optics,” he said.