TEAR gas billowed amid raging fires and anti-capitalist graffiti. The streets of Seattle had become a tapestry of defiance—drum circles pulsed through the city centre, papier-mâché puppets towered above the crowds, while protesters clashed with police clad in riot gear.
High above them, activists from the Rainforest Action Network scaled a construction crane to unfurl a massive banner, bearing two arrows pointing in starkly opposite directions—one reading “WTO” (World Trade Organization), the other “DEMOCRACY.”
In jarring contrast to the chaos outside, delegates in crisp suits moved briskly through the Washington State Convention and Trade Centre’s glass and steel façade and carpeted corridors—completely detached from the tumult on the streets.
This was none other than the Battle of Seattle in 1999, one of the most prolific and impactful protests by non-governmental organisations (NGOs) targeting corporate globalisation.
From Nov 30 to Dec 3, 1999, nearly 50,000 protesters, including environmental groups, trade unionists, indigenous rights advocates, farmers and more, converged from across the globe to mount a formidable resistance.
Their stance was a show of solidarity aimed at disrupting the WTO’s Ministerial Conference in Seattle, partly due to perceptions that the WTO was promoting corporate globalisation at the expense of labour rights, environment and national sovereignty.
The protests delayed the conference’s opening ceremony and kept the then United States Secretary of State Madeleine Albright trapped in her hotel room. Suffice to say, the collective power of the NGOs greatly disrupted the conference, leading to the collapse of talks and amplified global media coverage. This marks a defining moment for global activism against corporate-led globalisation.
When two worlds collide
NGOs have played the role of watchdog for decades—identifying, exposing and challenging companies whose actions fall short of their stated commitments.
Their campaigns span a wide range of industries, from fashion and food to fossil fuels, and have put global corporations under a microscope in ways that few other actors have managed to do.
A notable example emerged in 2023, when TotalEnergies was forced to revise advertising that misleadingly labelled its heating oil as “climate-neutral”.
This reversal was not prompted by regulators or investors, but by a campaign led by Climate Action Germany, an NGO that has long kept a close eye on corporate conduct.
Recently, A global research paper titled The Value of NGO Activism highlights how NGOs have emerged as a major force in driving sustainable development in recent decades, often outpacing governments and investors in influence.
Perhaps this is why corporates, which once dismissed NGOs as mere agitators or troublemakers, have begun recognising that NGOs are vital players in sustainability, driving real change and even holding profit-driven firms to account. Unmasking environmental hypocrisy
Despite the scale and influence of their work, the full impact of NGO-led scrutiny has often flown under the radar. To address this, The Value of NGO Activism study examined over 1,200 allegations made by 329 NGOs against 287 publicly listed firms worldwide.
These allegations centred on misleading or false claims related to environmental and social performance that range from overstating climate commitments to false advertising around product sustainability.
The term “environmental and social-washing” is used to describe the misrepresentation of a company’s environmental and social risks, practices or impacts to appear more favourable than reality.
For instance, an energy company might publicly promote its investment in renewable energy while simultaneously committing significant resources to oil and gas exploration.
Other firms were found to have inconsistent practices compared with their public pledges or to have made outright false statements.
The study revealed that 30% of such false claims related to climate change impacts, while others focused on consumer health (22%) and waste handling (11%). Issues like biodiversity, animal welfare and worker rights also featured prominently.
Interestingly, most allegations were centred on consumer-facing channels. Product packaging, advertising and public relations materials accounted for a combined 61.7% of cases.
Around 42% of alleged environmental and social-washing targeted consumers directly—a significant concern given that consumer choice is a key mechanism for encouraging companies to improve their ESG performance.
Environmental and social-washing was most commonly identified on product labels or packaging (25.3% of cases), advertising (23.1%), and public relations campaigns (13.3%).
Its lower occurrence in sustainability reports, financial filings and presentations suggests that scrutiny must extend beyond investor-focused communications.
Making real change
NGO actions can carry tangible financial and operational consequences for companies. The study found that firm stock prices fell by 0.34% on average within three days of an NGO allegation.
The decline was even sharper when the claims related to financially material issues. The effect was most pronounced among companies with high levels of institutional investor ownership, particularly those bound by stewardship codes.
These market reactions reflect mounting investor sensitivity to reputational and legal risks. It was noted that Volkswagen has paid out US$34bil in penalties linked to its emissions scandal, while Toyota has faced a US$150mil settlement.
NGO allegations also triggered increased media scrutiny. Negative ESG-related stories rose by 14.6% in the three days following an allegation.
Yet corporate responses remained limited—only 10% of firms issued a public statement and few directly acknowledged fault.
However, more encouragingly, was the evidence of behavioural change. Firms accused of climate-washing reduced their Scope 1 carbon emissions by between 5% and 7%, with the largest reductions observed among companies with significant stewardship investor ownership.
Furthermore, NGOs are found to have been increasingly using regulatory channels to strengthen their impact, urging authorities to act against misleading corporate practices.
Their investigations now inform European financial oversight, with bodies like the European Securities and Markets Authority integrating NGO insights to detect greenwashing and shape emerging regulations.
From pressure to partnership
The findings above point to the broader influence of NGO pressure in activating investor responses and prompting meaningful operational reform. With this in mind, businesses—where profit remains the primary measure of success—have begun recognising that the cost of ignoring ESG responsibilities is rising and that NGOs play an essential role in shaping that cost-benefit analysis.
In some cases, companies have moved from defensive postures to proactive partnerships. For example, Nike collaborated with Greenpeace to craft a policy ensuring its leather suppliers do not source from cattle raised in the Amazon; WWF co-developed sustainable sourcing strategies with Unilever.
Malaysian companies have also begun shifting from resisting NGO pressure to actively collaborating with corporations and civil society.
For instance, large corporations such as PETRONAS works with a range of NGOs, including government agencies and civil society organisations, to deliver environment programmes. The willingness to collaborate reflect a growing awareness that long-term business viability increasingly depends on environmental and social legitimacy.
All in all, NGOs’ influence and scrutiny have the power to move markets, reshape corporate strategy, and drive measurable environmental improvements.
While ESG investing plays a role in encouraging responsible business conduct, financial incentives alone are not enough.
Real accountability requires persistent, informed engagement—a role NGOs are uniquely equipped to play. They remain a vital force in ensuring that corporate sustainability is rooted in substance and long-term impact.
