top of page


‘That some reasonings are genuine, while others seem to be so but are not, is evident. This happens with arguments […] through a certain likeness between the genuine and the sham.’ So does Aristotle define a fallacy in Sophistical Refutations (c.350 BC.)

Fallacies are available to people for whom ‘it is better worth while to seem to be wise, than to be wise without seeming to be.’ Aristotle’s original taxonomy of 13 fallacies spawned an entire catalog of derivatives.

‘If the ESG concept were meaningful, it could be easily defined. The fact that it cannot be easily defined proves that it is not meaningful’ is a ‘questionable premise’ fallacy where a causal connection (meaningfulness and definability) is assumed with aplomb but without substance. Besides, the impossibility of agreeing upon the definition of the return on capital (e.g., ROIC, ROAC, ROCE, CRI, CROI, CFROI) has never prevented the ratio from being meaningful in corporate finance.

‘We, at Company X, have been integrating sustainability into our business model for decades. We do not welcome an ESG apparatus that tells us what to do’ is a perfect case of an ‘inconsistency argumentfallacy heard on the street. It is like Woody Allen’s joke: ‘I'd never join a club that would allow a person like me to become a member.’

Assuming that something is true in general because it is true in some instances, is a fallacy of the converse.’ For example: ‘If Company X provides products and services that enable the energy transition, its business is sustainable.’ This often-observed shortcut is hazardous. A sustainable business requires that not only its customer offering but also its operations be sustainable.

The straw manfallacy relates to misdirected argumentation. For instance, sustainability may be unfairly reduced to ‘doing well by doing good’ and its promoters presented as ‘evangelists’. The portrayal of ESG as a belief system driven by woke forces interfering with the markets creates a straw man that can be easily vilified at the expense of the true sustainability concept.

ESG ratings make no sense. They should be entirely ignored.’ This is the nirvanafallacy at play by suggesting that if something is not perfect, it does not deserve to be.

ESG is promoted by regulators and the financial industry. It is a scam’ is an example of ‘ad hominemfallacy using a populist opinion about government agencies and financial institutions to discredit an idea independently from its merit.

‘ESG is telling corporates how to manage their business, whom to hire, which suppliers to use, which customers to serve… Soon ESG will tell employees how to vote!’ This is an example of an appeal to extremesfallacy.

But then comes the ‘fallacy fallacy.’ It occurs when fair criticism is dismissed because it has been brought forward in a fallacious way. The sustainability concept is still in its infancy. Without criticism, it will fail to flourish. ESG deserves a healthy debate. Without sophistical refutations.

147 views0 comments

Recent Posts

See All

The Punch

Twelve months ago, 2021 was named the year of ‘The Great Dislocation’ (retrospective below). Demand had picked up, supply was in disarray, inflation was starting to rise beyond comfort, and monetary p

Bohemian Rhapsody

‘We are in ‘Bohemian Rhapsody.’ Repetition provides a sense of stability and predictability. For example, with its seasons, the annual cycle brings comfort by adding a cadence to peoples’ lives. The y


According to a 2022 Gallup survey, 71% of Americans approve of unions versus 64% before the pandemic, following a constant rise since 2009. The current level is at its highest since 1965, the year Pre


bottom of page