3.1 Research Design, Sampling, and Data Collection

Between April and July 2024, we conducted semi-structured interviews with 30 Ukrainian agricultural enterprises operating across 18 regions, including areas in the east and south that are directly or potentially affected by active conflict. To capture variation in ESG engagement, a purposive sampling strategy was employed, ensuring diversity in firm size, market orientation, and levels of reporting activity.

Table 1 summarizes the distribution of sampled enterprises by landholding size, trade orientation, and ESG reporting practices. Large enterprises (over 1000 ha), which dominate exports and are subject to external accountability pressures, were most frequently represented. Medium-sized firms primarily supply products to exporters and are governed by national tax and environmental reporting regulations. Small enterprises, oriented toward local markets, generally engage in ad hoc or minimal ESG reporting.

Each interview lasted approximately 1 h and was conducted via phone. The semi-structured format allowed respondents—primarily managers and chief accountants—to elaborate on themes beyond the predefined protocol. The resulting data set comprises 60 pages of transcribed responses, allowing for both pattern identification and context-sensitive interpretation.

The primary aim of these interviews was to investigate the drivers motivating Ukrainian agricultural enterprises to prepare ESG reports by examining their perceptions of sustainable development, readiness to adopt ESG practices, and the barriers to attracting investment in sustainable agriculture. Understanding these drivers is especially pertinent in the context of martial law, which introduces additional risks that can influence both enterprises' readiness for change and their perceptions of sustainability and reporting.

Given the high levels of social and economic uncertainty during periods of conflict and potential occupation, semi-structured interviews provide a methodologically robust approach to gathering contextually rich data, allowing for a balance between structure and flexibility (Bryman 2012; Kvale and Brinkmann 2009). This method is particularly valuable in extreme conditions, where respondents' perspectives are shaped by the need for rapid adaptation, as it allows them to articulate their experiences more freely (King 2004).

The interviews were conducted with managers and chief accountants of the participating enterprises, using 11 questions designed to balance standard aspects of sustainability with issues unique to Ukraine's current wartime context. Managers and chief accountants were selected as respondents due to their direct responsibility for strategic management and financial decisions impacting sustainable development. In our view, their insights are essential for studying ESG reporting. For example, we included the question, “How do you understand the concept of ‘sustainable development’?” to assess respondents' general perceptions of sustainability under martial law, where resource constraints and economic uncertainty are prominent factors (Creswell 2013).

Other questions, such as “Do you undertake any activities at your enterprise that could be defined as ‘sustainable agricultural practices’?” and “What risks are preventing investment in sustainable agricultural practices?” were intended to elicit specific examples of sustainable practices during wartime and to identify critical barriers unique to this period (Patton 2015). Additional questions, including “How has the opening of the land market as of January 1, 2024, affected your enterprise?” and “What does your enterprise expect from Ukraine's EU integration (threats, opportunities)?” were crafted to assess how the intersection of war and macroeconomic developments is influencing corporate strategy and the integration of ESG factors into these strategies.

Importantly, we sought responses to the direct question, “What could encourage you to prepare sustainability reports?” Previous studies suggest that common motivations for integrated reporting include regulatory requirements, transparency for investors and stakeholders, and enhancing corporate image (Eccles et al. 2014). However, for Ukrainian enterprises operating under wartime conditions, these factors alone may be insufficient, necessitating a more contextualized understanding of the incentives for ESG reporting.

3.2 Data Analysis

We employed thematic analysis to examine the interview data, enabling us to identify recurring patterns that reflect the underlying motivations, barriers, and contextual contingencies shaping ESG reporting practices among Ukrainian agricultural enterprises. Our analytic process unfolded in three stages.

In the first stage, each co-author independently reviewed the transcripts and conducted open coding to surface emergent concepts. In the second stage, we engaged in collaborative coding discussions to consolidate themes and cluster them into broader analytical categories. Finally, we conducted a cross-case comparison by firm size, allowing us to assess variation in ESG-related attitudes and practices across enterprise scales.

This process yielded five dominant themes, presented in Table 2. These themes reflect both institutional constraints and adaptive strategies related to ESG implementation in crisis settings.

3.3 Methodological Limitations

This study was conducted under significant logistical and security constraints, which may limit the generalizability of the findings. First, restricted access to active conflict zones likely excluded enterprises facing the most acute ESG challenges, thereby skewing the sample toward relatively more stable regions. Second, given the political and economic importance of EU integration, some respondents may have framed their answers in aspirational rather than empirically grounded terms, potentially introducing social desirability bias. Third, our findings are sector-specific and may not directly extend to other high-impact industries, such as energy or manufacturing, that operate under different institutional logics.

Nonetheless, we mitigated these constraints by sampling a diverse range of enterprise sizes and locations across accessible regions. Although the results are not intended to be statistically representative, they offer analytically rich insights into how ESG is interpreted and practiced under conditions of prolonged crisis.

4.1 Operational ESG Priorities

The first theme concerns how ESG practices are enacted operationally, often without formal recognition as “sustainable development.” Many enterprises engage in practices aligned with ESG principles (e.g., community support, resource-efficient farming), yet a shared conceptual understanding of sustainability is noticeably absent.

Roughly one-fifth of respondents equated sustainable development with environmental stewardship, whereas another fifth acknowledged confusion or unfamiliarity with the term. This semantic gap underscores a broader issue: ESG actions often precede ESG discourse, particularly in crisis settings where operational continuity eclipses abstract definitions.

Under martial law, the prioritization of social responsibility intensified, particularly among large and medium-sized enterprises. Nearly all respondents from these categories reported ongoing support for the army, internally displaced persons, and local communities. Yet, these actions—despite their scope and social value—remain largely absent from formal disclosure, reflecting both institutional gaps and a disjunction between operational and reporting systems.

These efforts reflect an expanded conception of corporate responsibility, although they are rarely documented through formal ESG disclosures. This discrepancy underscores the informal, relational nature of legitimacy in Ukraine's crisis context, where moral and operational imperatives often converge, but outside standardized reporting channels.

Interestingly, small enterprises were more likely to exhibit locally grounded environmental practices. Their embeddedness in communities where employees and landowners reside fosters an acute sensitivity to ecological degradation, even in the absence of regulatory incentives. In contrast, large and medium firms, while active, often reported only selectively, with many initiatives omitted from official statistical or tax filings (see Figure 1).

4.2 EU Regulatory Pressure and Practical Constraints

European integration has introduced new institutional pressures for Ukrainian agricultural enterprises, particularly concerning ESG reporting. As Ukraine's largest trading partner, the European Union imported goods worth EUR 22.8 billion in 2023, with grain, vegetable oils, and oilseeds among the top export categories (European Commission 2023b). Firms seeking to remain competitive within EU markets increasingly confront expectations related to environmental stewardship, labor rights, and corporate transparency.

These expectations are shaped by a complex regulatory ecosystem that includes the Farm–to-Fork Strategy (European Commission 2020), the Organic Production and Labelling Regulation (European Parliament 2018), and the Sustainable Finance Disclosure Regulation (European Parliament and Council 2019). For countries like Poland, accession to the EU was accompanied by transitional support mechanisms under the Common Agricultural Policy (OECD 2023)—a precedent that underscores the importance of capacity-building alongside compliance. Similar instruments may be critical in Ukraine's post-war reconstruction, particularly if ESG reporting is to serve both as a governance tool and as a means of investor signaling within EU supply chains.

Against this backdrop, our interviews sought to understand how Ukrainian agricultural enterprises interpret these regulatory shifts and how they reconcile aspirational ESG frameworks with domestic institutional and resource constraints.

Our findings indicate that perceptions of regulatory pressure vary by enterprise size, reflecting differing levels of exposure to European markets and institutional readiness. Large enterprises, which are directly embedded in export markets and subject to stock exchange and investor scrutiny, report the most intense compliance demands. Medium-sized enterprises face notable pressure as indirect suppliers, whereas small firms, primarily oriented toward local markets, encounter minimal external ESG obligations. Despite these differences, regulatory expectations are broadly perceived as complex and burdensome, especially in light of persistent domestic challenges such as corruption and bureaucratic inefficiency (see Figure 2).

Taken together, these accounts illustrate a convergence of regulatory aspiration and institutional constraint. Although firms acknowledge the strategic value of ESG compliance, particularly for accessing European markets, the gap between ambition and implementation remains wide. This tension underscores the need for targeted technical assistance and institutional scaffolding to bridge the compliance divide.

4.3 Financial Materiality and the Agricultural Land Market

Financial materiality emerged as a dominant theme across all interviews, particularly concerning the agricultural land market. Under the CSRD, double materiality emphasizes not only how firms affect the environment and society but also how sustainability issues impact financial performance. In the Ukrainian context, land ownership and access to capital are critical domains where this relationship is most salient. We interpret ESG reporting as a mechanism that can enhance firms' investment attractiveness in three interconnected ways. First, enterprises seeking to purchase land often require external financing, and ESG disclosures signal transparency and long-term viability to lenders and investors. Second, land consolidation is increasingly associated with adherence to environmental standards, encouraging firms to report on resource use, soil health, and biodiversity conservation. Third, as new land users enter rural communities, social responsibility becomes essential for maintaining legitimacy and securing land tenure.

These dynamics must be understood in light of Ukraine's evolving land governance system. Following decades of privatization beginning in 1992 and a long-standing moratorium on land sales, the land market was partially liberalized in July 2021, allowing private citizens to sell land in parcels of up to 100 ha. A second phase of reform began on January 1, 2024, extending purchase rights to legal entities—including agricultural enterprises—up to a limit of 10,000 ha per entity. This institutional shift has made ESG performance not merely a reputational issue but a strategic consideration tied to land access, investment, and long-term competitiveness.

Currently, most agricultural land in Ukraine is owned by private individuals, and most land transactions involve leasing, which exceeds buying and selling. Since the July 2021 market opening for the purchase and sale of farmland plots among solely private individuals, 199,842 purchase transactions have been made, covering 444,260 ha at an average price of UAH 36,096 per hectare (USAID 2024).

In discussing the agricultural land market, respondents expressed concerns about the weakness of the land market institutions, which create risks of land grabbing⁴ and negatively impact the implementation of sustainable land use practices and reporting. Despite the opening of the land market for the purchase and sale of agricultural land, especially for agricultural enterprises, nearly half of the surveyed enterprises refrained from purchasing land.

The financial dimensions of land ownership emerged as a critical factor influencing ESG disclosure strategies. Most farmland operated by Ukrainian agricultural enterprises is still leased from smallholder landowners—private individuals who gained ownership through land reform. In this environment, firms face both legal uncertainty and competitive pressure. Some respondents feared that landowners might reclaim or sell their land to third parties, whereas others raised concerns about raider seizures involving collusion with corrupt officials.

These land-related pressures shape how firms view ESG reporting. Rather than treating sustainability disclosure as a reputational strategy, many enterprises approach it more pragmatically—linking it to financial incentives and access to capital. Across the sample, small firms were most explicit in framing ESG reporting as a pathway to investment or subsidy access. Medium-sized enterprises similarly emphasized financial outcomes, often tied to export opportunities or credit. Larger enterprises while slightly more reserved in this regard, also connected reporting to tangible economic benefits.

Taken together, these responses reveal a dominant logic of instrumental ESG engagement: sustainability reporting is embraced when it is tightly linked to financial returns and institutional stability. This underscores the critical role of economic incentives and governance credibility in embedding ESG practices in fragile institutional environments (see Figure 3).

4.4 Skepticism Toward ESG Reporting

A notable theme across interviews, particularly among large and medium-sized enterprises, was measured skepticism toward ESG reporting. This skepticism did not reflect overt rejection of sustainability principles, nor was ESG viewed as a vehicle for greenwashing. Rather, it emerged from concerns about bureaucratic inefficiencies, unreliable internal performance indicators, and uncertainty about the tangible impact of disclosure on environmental and social outcomes.

Interestingly, small enterprises expressed no skepticism, likely due to their limited engagement with ESG systems in the first place. This absence suggests not endorsement, but nonparticipation, reinforcing earlier findings about their dependence on external incentives to trigger ESG adoption.

Overall, skepticism across the sample reflects rational instrumentalism rather than ideological resistance. ESG reporting is not dismissed outright but is viewed through a cost–benefit lens: Firms are willing to engage if there is a clear financial or strategic return. This supports our broader argument that effective ESG promotion must account for the economic mechanisms that shape reporting behavior, particularly in settings marked by institutional fragility and capacity constraints.

4.5 Adaptive ESG Innovation Under Wartime Constraints

A final theme concerns how enterprises navigate wartime disruptions through adaptive investments in sustainability. Interviewees described numerous barriers to ESG implementation—including workforce shortages, rising input costs, and unstable logistics—all exacerbated by the conditions of martial law. These disruptions constrain long-term planning and capital investment, particularly in the domain of environmental technologies and reporting systems.

The wartime context has pushed firms to reconsider their investment strategies. Some large enterprises reported prioritizing decentralized energy solutions, upgrading machinery to improve resource efficiency, and adopting digital platforms to enhance logistics resilience. These actions signal a shift toward strategic ESG adaptation—not driven by external regulation alone, but by the exigencies of conflict.

Although these innovations are not always reflected in formal ESG reports, they reflect a deeper recalibration of what sustainability means in crisis economies. In this sense, wartime ESG practices challenge standard models of compliance and reveal a more dynamic relationship between survival, legitimacy, and innovation.

Military conflict emerged as the most significant risk to investing in sustainable agricultural practices, with enterprises seeking state support, state guarantees, and stability. Despite the issuance of 42,847 soft loans worth UAH 170.5 billion under the “Affordable Loans 5–7–9%” state program during martial law (Ministry of Finance of Ukraine 2023), the volume of assistance was deemed insufficient.

Taken together, these accounts reveal how investment decisions under wartime conditions are shaped not only by economic calculation but also by governance trust and physical security. In such environments, ESG engagement becomes contingent on the broader risk infrastructure, with firms pursuing sustainability only when institutional scaffolding is credible and consistent.

Investment capacity during wartime varied sharply by firm size. When asked about their current priorities, nearly half of the respondents stated they were unable to invest due to financial or logistical constraints. A smaller subset of firms—primarily large enterprises—reported targeted investments in storage facilities, which they described as critical to safeguarding outputs during air raids.

This focus on physical resilience reflects a broader recalibration of strategic priorities. In 2022, the Food and Agriculture Organization (FAO) supplied Ukraine with 30,000 grain storage bags and 105 equipment sets, covering roughly 30% of the country's 6-million-ton storage deficit (FAO 2023). Although such measures provided partial relief, enterprises emphasized the importance of independent risk-mitigation infrastructures, especially as military threats became a constant in their strategic calculations.

As illustrated in Figure 5, large enterprises were most active in adopting adaptive technologies, ranging from modern grain dryers and decentralized energy systems to precision cultivation equipment. Medium-sized firms also implemented efficiency-oriented measures but faced resource constraints. Small firms showed the lowest investment levels, reinforcing their structural vulnerability.

Across all firm types, risk analysis and threat mitigation have become integral to business planning. Reflecting such practices in ESG reporting would not only document compliance, but also demonstrate strategic foresight and operational resilience—reframing reporting from a regulatory burden to a signal of adaptive capacity under duress.

5.1 Business Strategy or Moral Justification of ESG Reporting?

The interviews show that most respondents associate sustainable development with concrete social initiatives (e.g., support for the army and local communities) and ecological practices (e.g., lean tillage, minimizing environmental harm). Their orientation is shaped by practical constraints—economic pressures from war, fluctuating market prices, and logistical disruptions—highlighting a rational, necessity-driven approach. Rather than invoking abstract ethical ideals, respondents' concerns are grounded in immediate challenges. War, corruption, and economic instability emerge as major barriers to ecological investment, reinforcing a focus on survival. New practices, such as energy-efficient technologies, are implemented only when they offer specific, expected outcomes. This pragmatic approach aligns with the business case for sustainability and echoes Trahan and Jantz's (2023) argument that ESG should function not only as a tool for improving environmental performance but as a strategic means of achieving corporate resilience, especially where social and economic factors are central to long-term viability.

In contrast to ESG practices in the Global West, where a stable socio-economic environment enables firms to frame sustainability as a moral imperative linked to long-term goals (Eccles et al. 2014), Ukrainian enterprises pursue ESG reporting with an emphasis on operational continuity under extreme conditions. This produces a selective and adaptive interaction with ESG, where actions are judged by their direct impact on business viability (Arvidsson and Dumay 2021), rather than alignment with formal external standards. This dynamic reflects Herzig's (2023) observation of a dominant business-case logic, which can risk undermining public trust when social and environmental issues are neglected or insufficiently addressed. Although Western ESG practices often emphasize strict compliance with international indicators, Ukrainian firms assess success through tangible, often local outcomes, such as energy decentralization or soil restoration, rather than global ESG rankings. This perspective aligns with Rasche et al. (2023), who caution that a business-only orientation may lead to formal compliance at the expense of substance, whereas ethical expectations can drive more responsible and balanced corporate behavior.

It is important to note that Ukrainian agroholdings that export are often motivated to disclose ESG information due to requirements from stock exchanges on which their securities are listed. Small and medium-sized enterprises (SMEs), however, are not subject to these requirements. As Barro et al. (2024) observe, rural populations—including local communities and consumers—are often excluded from formal ESG disclosure processes. Yet in Ukraine, the dynamic differs. Daily communication between local leaders and rural residents, including through local newspapers and social media, means these communities may be more informed about company activities than external investors who skim a single ESG page in an annual report. Local stakeholders may be less interested in quantified indicators, but they closely observe a firm's visible actions and investments at the community level—aligning ESG with moral, rather than merely regulatory, expectations.

Additionally, companies engaged in land demining or employing internally displaced persons exhibit concern for community and environmental welfare, but also advance their own economic survival by bringing land and labor back into productive use. This suggests that moral justification and business logic are not in conflict, but mutually reinforcing. In contrast to the Western context, where morality and profitability are often seen in tension, Ukrainian enterprises frequently align moral considerations with business goals. In this setting, ESG reporting reflects both regulatory compliance and voluntary moral engagement, supporting survival and economic viability alike.

5.2 Extreme Financial Materiality as a Path to Rethinking Global ESG Reporting Systems

Our findings reinforce the concept of financial materiality outlined in ESG reporting literature, which posits that only those environmental, social, and governance factors materially affecting a firm's financial outcomes and long-term viability should be prioritized (Eccles et al. 2014). In Ukraine, ESG reporting is seen as valuable only when tied to concrete financial benefits, such as subsidies, market access, affordable credit, or investment, particularly for land acquisition. In the absence of such incentives, ESG disclosure is often viewed as an administrative burden, in line with Khan et al.'s (2016) argument that firms prioritize financially material ESG issues and largely disregard non-material sustainability efforts with limited business impact. This raises a key question: Is ESG reporting in Ukraine's agricultural sector merely an intensified expression of financial materiality, or does it point to the need for rethinking global ESG standards?

On one hand, Ukraine represents an extreme manifestation of global ESG trends, where firms focus on ESG metrics with direct financial or regulatory implications. The prioritization of survival-oriented, financially driven ESG practices mirrors broader investor behavior, particularly in conflict zones with institutional fragility. However, unlike symbolic reporting practices criticized by Milne and Gray (2013), which often mask limited real-world sustainability outcomes, ESG activity in Ukraine tends to reflect concrete operational responses to immediate risks, suggesting substance over form.

On the other hand, Ukraine challenges the very structure of current global ESG frameworks, which are largely designed for stable institutional environments. These frameworks often fail to accommodate the realities of crisis economies. As Joseph et al. (2023) argue, sustainable business in conflict zones demands a specialized approach—one that can both respond to crisis and contribute to economic recovery and peacebuilding. The Ukrainian case supports this view, suggesting a need to recalibrate ESG systems to better account for volatility, instability, and acute risk.

Rather than rejecting the double materiality principle, our findings suggest a need for improved harmonization between its components. Financial materiality—focused on how ESG factors affect profitability, investment appeal, and regulatory access—defines immediate priorities for firms operating under duress. In contrast, impact materiality—how firms affect the environment, labor, or society—remains secondary in crisis settings, though its long-term strategic value is widely acknowledged.

As economic and geopolitical instability becomes more globally pervasive, the limitations of traditional ESG frameworks are increasingly evident. A shift is needed: Global ESG standards must evolve to account for crisis conditions that reshape corporate priorities. Although short-term focus on financial materiality is often necessary for survival, long-term sustainable development depends on the deeper integration of social and environmental dimensions. This rebalancing is essential to ensure that ESG reporting remains credible and effective—not just in stable markets, but in fragile economies where sustainability is both more difficult and more urgent.

5.3 High Authenticity in Conditions of Low Institutionalization

A central question emerging from our interviews was whether ESG integration among Ukrainian agricultural enterprises reflects strategic necessity or rational non-compliance with formal standards. Our findings reveal moderate skepticism, up to 50% among medium and large enterprises, primarily driven by uncertainty about their own indicators rather than attempts at image manipulation. Respondents questioned whether their practices met international benchmarks, whether ESG reporting would be reliable and whether it would yield tangible environmental or social impacts. Concerns also centered on the cost and effort of reporting in the absence of clear benefits.

Importantly, our data contradict assumptions that ESG disclosures in Ukraine are opportunistic. Contrary to He et al. (2024), who suggest firms may manipulate reporting for reputational gain, we found no evidence of such “glossy” disclosures. In fact, companies often avoided reporting altogether unless incentivized by regulatory or financial pressures. This reluctance reflects not hypocrisy, but pragmatic resource allocation under extreme constraints. Paradoxically, such skepticism may foster greater authenticity, as firms report only on practices aligned with real capabilities and operational priorities.

This contrasts sharply with highly institutionalized ESG environments. In the Global West, adherence to standards such as GRI, SASB, ESRS, and TCFD is widely expected, enabling the integration of ESG into corporate strategy and public discourse. Yet, this institutionalization has also enabled symbolic compliance. As Cho et al. (2015) and Boiral (2013) argue, high ESG ratings do not guarantee transparency or impact; reports may obscure harmful practices and function as reputational tools. Excessive moral expectations—on climate change, human rights, inequality—can create unrealistic burdens that firms address rhetorically rather than substantively.

By contrast, ESG in Ukraine operates in a context of low institutionalization. Firms face weak national frameworks, limited awareness of sustainability principles, and harsh operating conditions shaped by war, corruption, and economic instability. Despite this, their sustainability actions tend to be authentic, oriented toward survival and resilience, such as decentralized energy use and local supply stabilization, rather than compliance for its own sake. Our findings challenge conclusions by Jauernig and Valentinov (2019), who argue that CSR activities often serve to deflect accusations of hypocrisy. In Ukraine, ESG efforts are internally motivated and context-driven, not constructed for external approval.

The absence of formalized expectations reduces performative pressure, limiting the incentive for greenwashing. Instead, ESG activity is grounded in feasibility and necessity, not symbolic alignment with global frameworks. This reflects a pragmatic, honest engagement with sustainability, focused less on moral obligation than on operational continuity. In crisis contexts, such as Ukraine's, the lack of institutionalization may paradoxically foster a more authentic and adaptive sustainability logic—one that reflects the lived challenges of instability rather than the aspirational norms of stable economies.

6.1 Policy and Legal Regulation

Geopolitical instability and military conflict demand a rebalancing of financial and impact materiality in ESG reporting. Current global ESG standards are designed for stable institutional environments and often fail to account for the realities of crisis economies. We argue that, at the global level, ESG frameworks should prioritize financial materiality, enabling firms to assess business continuity risks in conflict-prone contexts. Impact materiality—capturing long-term environmental and social dimensions—should serve as a critical complement, not a prerequisite.

Regionally, Ukraine's integration into the EU exposes its agricultural enterprises to competition with European producers who benefit from agroecological subsidies and established sustainability frameworks. In this context, Ukraine requires an adaptive ESG transition model that reduces regulatory burdens while supporting the integration of sustainable practices into business operations.

At the national level, policy should focus on developing advisory services to support SMEs in sustainability reporting. This could be reinforced by reforms in vocational and higher education to incorporate ESG reporting and sustainability consulting into financial training curricula. Strengthening the institutional infrastructure for accountability can be further advanced through agricultural producer associations and independent consulting centers. These organizations can both raise awareness about the benefits of the green transition and provide critical feedback on implementation barriers and practical solutions.

6.2 Shaping a New ESG Landscape in Ukraine's Agricultural Sector Under EU Integration

A key theme emerging from our interviews was the integration of Ukraine's agricultural sector into the European Union and its implications for ESG reporting. As Ukraine remains in the early stages of implementing EU-aligned sustainability standards, this transitional phase offers a unique opportunity to assess the sector's readiness to incorporate ESG principles into existing tax, statistical, and environmental reporting systems. This is relevant not only for exporters but also for upstream suppliers in the value chain, significant contributors to emissions, soil degradation, and biodiversity loss.

Our findings suggest that EU integration creates a dual dynamic for ESG: It offers access to economic recovery and European markets while simultaneously imposing regulatory demands—phytosanitary, environmental, labor, and transparency-related—that may overwhelm businesses operating under crisis conditions. We identify three core implications of this integration process.

First, EU frameworks such as CSRD, the Farm-to-Fork Strategy, CBAM, and the EU Taxonomy are premised on economic stability—a condition that does not reflect the current Ukrainian reality. Second, Ukrainian agricultural enterprises must compete with EU producers who benefit from substantial subsidies and well-established sustainability systems, raising equity concerns in ESG implementation. Third, the rigid application of EU reporting requirements may be ill-suited to conflict-affected economies. Instead, a more flexible approach—emphasizing gradual alignment and realistic goal-setting—is essential (Trahan and Jantz 2023).

Accordingly, Ukraine's EU accession process should be accompanied by adapted ESG reporting mechanisms. This includes limiting information demands from large firms to SME partners, simplifying reporting and audit procedures, and providing technical assistance to help SMEs measure and communicate sustainability performance. These insights may also inform ESG integration strategies in other economies navigating post-conflict recovery and institutional transformation.

6.3 ESG Reporting Model Adapted to Crisis Situations

Our findings point to the need for an adaptive ESG reporting model tailored to crisis economies, such as Ukraine. Unlike traditional models developed in the Global West, which are grounded in institutional stability and long-term strategic planning, the adaptive model responds to high volatility caused by war, economic shocks, and weak financial infrastructure. It emphasizes flexibility, situational responsiveness, and a recalibration of ESG priorities in line with immediate business and societal needs.

Table 3 compares conventional ESG frameworks in stable markets with the adaptive features required in crisis contexts. The model outlines key differences across six dimensions: market conditions, regulatory frameworks, materiality, institutionalization, authenticity, and moral justification. It illustrates how ESG in Ukraine has evolved under duress, not as a compliance mechanism, but as a survival strategy. This context challenges existing global ESG standards and calls for a more flexible architecture that can support firms navigating extreme risk environments. The adaptive ESG model also carries broader implications for global sustainability governance. It suggests that financial materiality must be foregrounded in crisis contexts, whereas impact materiality can be phased in as stability improves. Moreover, the alignment between moral responsibility and business continuity, rather than their separation, may offer a more realistic foundation for ESG in fragile settings. These insights can inform the redesign of ESG frameworks, especially within EU policy and emerging economies facing systemic disruption.

Source: Developed by authors based on interview data.

6.4 Corporate ESG Strategies

Our interview findings highlight three key barriers to the adoption of ESG reporting in Ukraine's agricultural sector: limited knowledge of nonfinancial reporting methodologies, uncertainty around meeting ESG performance indicators, and a lack of clarity on the benefits relative to the costs of disclosure.

Addressing these challenges requires greater awareness of sustainable agricultural practices and the strategic value of ESG integration. Educational initiatives and stakeholder engagement—bringing together regulators, investors, local communities, and advisory services—can help enterprises evaluate the potential advantages of ESG reporting before embedding it into their strategies. For example, when adopting environmental practices such as zero-tillage, firms should be equipped to assess both financial incentives, such as subsidies, green loans, carbon credits, or tax relief, and nonfinancial gains like enhanced reputation and stakeholder trust.

Given the high costs of ESG compliance—including environmental data collection, staff training, financial consulting, and third-party audits—these support mechanisms are especially critical for firms operating in conflict-affected or resource-constrained markets. Clear visibility into both the financial and strategic returns on ESG investments can improve adoption and ensure that sustainability becomes a value-creating component of business strategy rather than a regulatory burden.