During the first year of President Donald Trump’s (R) second administration, federal agencies took a series of actions affecting environmental, social and governance (ESG) considerations in financial regulation, labor policy, environmental reporting, and corporate governance. Rather than a single sweeping change, these actions occurred through several mediums including rule withdrawals, enforcement decisions, and shifts in agency priorities.
Many of the actions involved rolling back or declining to defend policies adopted during the Biden administration, particularly those related to climate disclosure, fiduciary standards and climate risk oversight. Others focused on proxy voting, emissions reporting and U.S. participation in international climate-related initiatives.
The following timeline highlights key ESG-related federal actions taken during the administration’s first year, presented in chronological order:
Jan. 17, 2025—Federal Reserve exits global climate-risk regulatory network
The Federal Reserve announced it was withdrawing from the Network of Central Banks and Supervisors for Greening the Financial System, an international group of central banks and financial regulators focused on climate-related financial risks. The Fed said the scope of the network’s work had expanded beyond the board’s statutory mandate, and that it would continue to assess economic and financial risks, including those related to climate, within its existing authorities rather than through participation in the group.
March 2025—Federal Reserve disbands internal climate-focused offices
The Federal Reserve shut down several internal committees and working groups focused on climate-related financial risks, including units tied to bank supervision, financial stability, economic activity, and data analysis. The Fed established the groups beginning in 2021 to build institutional capacity around climate risk. Federal Reserve staff were notified of the closures internally, and officials said climate-related risks would instead be addressed through the central bank’s existing supervisory and research processes.
March 27, 2025—SEC votes to end defense of climate disclosure rule
The Securities and Exchange Commission (SEC) voted to end its legal defense of a Biden-era rule requiring public companies to disclose climate-related risks and greenhouse gas emissions. The rule, finalized in 2024, has not taken effect and remains subject to litigation. Acting SEC Chair Mark Uyeda said the commission questioned the rule’s statutory authority and cost-benefit justification, and the decision signaled that the SEC would no longer seek to defend the regulation in court.
April 8, 2025—Trump issues executive order directing DOJ to challenge state climate and ESG laws
President Trump issued an executive order directing the Justice Department to identify and seek to block enforcement of state and local laws that burden domestic energy development and that the administration determines are unconstitutional, preempted by federal law, or otherwise unenforceable. The order instructs the attorney general to prioritize addressing state laws and legal actions related to climate change, greenhouse gas emissions, environmental justice and ESG initiatives, and to report to the president within 60 days on actions taken and any recommended further executive or legislative steps.
April 29, 2025—Fannie Mae shuts down ESG department
Fannie Mae closed its ESG department and eliminated more than 30 positions, including leadership roles. The action followed leadership changes at the Federal Housing Finance Agency, which oversees Fannie Mae and Freddie Mac, and occurred as the Trump administration moved to reduce ESG- and DEI-related initiatives across federally backed entities. Fannie Mae’s congressional charter does not provide for the ESG program.
May 28, 2025—Labor Department ends defense of ESG retirement rule
The U.S. Department of Labor announced it would no longer defend in court a Biden-era rule governing how retirement plan fiduciaries may consider ESG factors when selecting investments and exercising shareholder rights. The rule, finalized in 2022 and in effect since January 2023, remains formally in place as of January 2026, but the department said it plans to propose a replacement rule. The change creates uncertainty for plan sponsors and fiduciaries while litigation over the existing rule continues.
June 12, 2025—SEC withdraws proposed ESG disclosure rules
The SEC withdrew two proposed rules related to ESG disclosures, including a proposal that would have expanded ESG reporting requirements for investment advisers and funds and another that would have revised the shareholder proposal and resubmission process. The SEC issued both proposals were issued during Biden administration, but never finalized the rules. Their withdrawal halted planned ESG-related rulemaking at the commission and left existing disclosure and shareholder proposal rules in place.
Sept. 13, 2025—EPA proposes ending greenhouse gas emissions reporting program
The U.S. Environmental Protection Agency (EPA) published a proposed rule to eliminate the Greenhouse Gas Reporting Program, which requires large emitters, including fossil fuel producers, to report annual greenhouse gas emissions data. The program, established in 2009 under the Clean Air Act, has served as a central source of emissions data for federal regulators and the public. The proposal opened a public comment period and would not immediately end reporting requirements.
Oct. 9, 2025—Federal banking regulators withdraw climate-risk principles for large banks
The Federal Reserve and the Federal Deposit Insurance Corporation announced they would withdraw the Principles for Climate-Related Financial Risk Management for Large Financial Institutions, which had been issued in 2023. The agencies said they no longer believe climate-specific principles are necessary and that banks should instead manage climate-related exposures through existing supervisory expectations for material financial risks.
Nov. 12, 2025—FTC launches antitrust investigation into proxy advisory firms
The Federal Trade Commission opened an antitrust investigation into proxy advisory firms Institutional Shareholder Services and Glass Lewis, examining whether their competitive practices and shareholder voting recommendations violate federal antitrust laws. The inquiry focuses on the firms’ influence over institutional investor voting, including recommendations on environmental and social shareholder proposals. The investigation remains non-public, and neither firm has been formally accused of wrongdoing.
Dec. 11, 2025—Trump issues executive order on proxy advisory firms
President Trump signed an executive order titled “Protecting American Investors from Foreign-Owned and Politically-Motivated Proxy Advisors,” directing federal agencies, including the U.S. Securities and Exchange Commission, Federal Trade Commission, and U.S. Department of Labor, to review and consider revisions to rules, guidance and enforcement related to proxy advisory firms Institutional Shareholder Services and Glass Lewis, including whether existing practices raise competition, disclosure or fiduciary concerns.