UBS Climate Target Delays After Credit Suisse Merger: A Strategic Analysis of ESG Commitments vs. Shareholder Value
Year: 2025
Type: article
Abstract: This strategic analysis examines UBS Group AG's significant retreat from its climate commitments following its emergency acquisition of Credit Suisse. In 2025, UBS announced a ten-year delay to its operational net-zero target, removed climate-linked metrics from executive compensation, and withdrew from the Net-Zero Banking Alliance (NZBA). The presentation frames these actions as a pivotal case study in the tension between Environmental, Social, and Governance (ESG) pledges and shareholder value, particularly during a complex post-merger integration. Utilizing frameworks such as the Triple Layered Business Model Canvas, Stakeholder Theory, and Carroll's CSR Pyramid, the analysis identifies critical governance failures and a strategic shift towards shareholder primacy. It assesses the multifaceted impacts on key stakeholders—including shareholders, clients, employees, and civil society—revealing both short-term financial gains and significant long-term reputational and financial risks. The report concludes that UBS's approach creates a false dichotomy between integration and sustainability, treating ESG as a dispensable "bolt-on" rather than an integral component of long-term strategy. It offers five strategic recommendations for UBS to rebuild credibility, including reinstating climate-linked executive pay, establishing an accelerated financed emissions pathway, and launching a climate transition financing initiative, ultimately arguing that authentic ESG integration is a strategic imperative for sustainable value creation.
Author: Tan, Kwan Hong
Institution: Singapore University of Social Sciences
Language: English
Subfield: Strategy and Management
Domain: Social Sciences
SDG: Climate action
Open Access status: green
OpenAlex ID: W7103752563
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