Policy rollbacks define 2026
When corporations announce policies, stakeholders expect them to be upheld. But a dramatic reversal is taking place. If 2020 was the time for grand social and environmental pledges, 2026 is the year of the rollback. Target, Walmart, Meta, Amazon, McDonald’s, Warner Bros and Goldman Sachs are among the one in eight companies that have so far weakened diversity, equity and inclusion (DEI) policies. Meanwhile almost one in five (18 percent) completely or partially discarded their net-zero promises.
Corporate policy reversals are accelerating after the 2024 election.
The reversals first emerged when Trump re-entered the White House and started revoking guidelines himself. By 2025, the fires were roaring. In a striking moment, the Net-Zero Banking Alliance collapsed after Bank of America, JPMorgan Chase, Citigroup, Wells Fargo, Morgan Stanley and Goldman Sachs all withdrew. Today, corporate rollbacks continue to compound at pace. The sudden drop in commitment reflects the aggressive ‘anti-woke’ philosophy of the Trump administration. For investors, this opens a Pandora’s box of new risks.
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With boycott risk comes increased litigation risk. A survey by Norton Rose found twice as many companies were impacted by ESG-related (environmental social governance) class actions in 2025 (30 percent) compared to 2024 (16 percent). Political pressure is listed as a top trend contributing to the increased risk exposure. For shareholders, it is worrying. Companies with revenues exceeding $1bn spend an average of $4.3m on litigation, which eats into profitability.
One retailer saw its value collapse after capitulating to pressure.
One of the companies that has become synonymous with rollbacks is mega-retailer, Target. In November 2024, the brand bowed to pressure to remove Pride merchandising, leading to boycotts and a 20 percent drop in share prices. Just a few months later, Target went on to U-turn on its DEI initiatives, notably to end its Racial Equity Action and Change (REACH) strategy and abandon a $2bn pledge to support Black businesses. This sparked one of the most devastating boycotts in US corporate history, with footfall dropping by nine percent and share prices losing 33 percent of value year-on-year.
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CEO Brian Cornell was forced to step down and shareholders have filed class-action lawsuits. Target is alleged in the courts to have engaged in the “misuse of investor funds to serve political and social goals.” This is particularly painful for a store with a significant African American customer base. By bowing to politics, it alienated its own customers. As one shopper commented, “We don’t buy where we are not respected.”
Shareholders are questioning the rules of the market.
Regulatory Design Specialist, Dr Roger Miles, suggests the market is pushing aside normal “verification, checks and balances” in favor of populist politics. “Lets call it what it is: it is expediency,” he elaborates. “I threaten you, you give me what I want.” Today’s commodification of values means that policies are bought, sold and amended like products, without meaning anything. This transactional behavior is closer to gangsterism than capitalism. It is particularly pronounced in the cases of social media providers like Meta, where whistle-blowers allege that algorithms are skewed to promote content that the Trump administration aligns with.
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Worryingly, 2026 feels like a year where the normal rules are pushed aside. When listed companies abandon policies because they want to appease a President, the market stops becoming reassuringly rules-based and starts to become mafia-style. Earlier this year, the ‘Sell America’ trend took off. Investors have already started to mobilise against what they see as unacceptable corporate behaviour. In this age of AI and climate uncertainty, consumers are anxious about the direction of their futures, and have even less tolerance for companies that appear to sell them out.
Dr Miles refers to this as a “Wile E. Coyote moment,” or “hysteresis” to use the behavioural economics term. Characteristically, the cartoon runs off the edge of a cliff and continues to run in mid-air for a while. It is only when he looks down and acknowledges the mistake that he falls. This is what Dr Miles believes could be happening now. “These are strongly fragile conditions,” he explains. For a short period, the market is continuing to act as if nothing has changed and everything is fine. But as the realisation that we are moving from rules to mafia-techniques hits without checks and balances, the crash could be colossal.
