ESG-Driven Brand Strength and Stakeholder Trust at Sarepta Therapeutics: A Balancing Act for Long-Term Investor Value

In the evolving landscape of biotechnology, corporate social responsibility (CSR) has become a critical lens through which investors evaluate long-term value. Sarepta Therapeutics, a leader in gene therapy for rare diseases, has positioned itself as a company committed to ESG (Environmental, Social, and Governance) principles. However, recent regulatory and financial challenges—particularly surrounding its flagship therapy Elevidys—raise questions about how effectively these initiatives translate into brand strength and stakeholder trust.

ESG Initiatives: A Foundation for Brand Strength

Sarepta’s 2023 Corporate Responsibility Report underscores its dedication to sustainability and inclusivity. Environmentally, the company has implemented green lab practices, recycling programs, and sustainable commuter benefits, aligning with global decarbonization trends [1]. Socially, it emphasizes diversity, equity, and inclusion (DEI) through five employee resource groups (ERGs), including HUES (Hispanic Unity & Empowerment), PRIDE (LGBTQ+), and M-ERG (Multicultural), which foster professional development and cultural awareness [1]. These efforts are complemented by programs like SareptAssist and SareptAlly, which provide patient access to clinical trials and treatments, reinforcing its mission to address unmet medical needs [1].

Third-party assessments, such as MSCI’s BBB ESG rating, validate Sarepta’s moderate alignment with industry standards [2]. While this score reflects progress, it also highlights gaps in areas like supply chain transparency and community impact, which could limit the company’s ability to fully leverage ESG-driven brand equity.

Stakeholder Trust: A Double-Edged Sword

Sarepta’s ESG initiatives are designed to cultivate trust among stakeholders, including patients, employees, and investors. For instance, its focus on clinical trial diversity—ensuring equitable access to therapies for underrepresented communities—addresses systemic inequities in healthcare [1]. Similarly, employee wellness programs and community sponsorships enhance its reputation as a socially responsible employer and corporate citizen.

However, recent events have tested this trust. The FDA’s heightened scrutiny of Elevidys, following three patient deaths linked to the therapy, has led to a 55% drop in revenue forecasts for 2025, from $2.1 billion to $928 million [3]. This regulatory backlash not only threatens financial stability but also risks undermining confidence in Sarepta’s safety protocols and ethical governance. Analysts from Barclays and Citigroup have downgraded their ratings, citing “heightened uncertainty” [3], while others, like Oppenheimer, maintain optimism about the company’s long-term potential [3].

The ESG-Brand Value Nexus

The interplay between ESG performance and brand strength is particularly pronounced in the biotech sector, where public perception can sway investor sentiment. Sarepta’s DEI initiatives and patient support programs align with broader societal expectations for corporate accountability, potentially enhancing its brand as a “mission-driven” innovator. Yet, the Elevidys controversy underscores a critical vulnerability: ESG missteps or regulatory failures can erode trust faster than CSR campaigns can rebuild it.

This tension is further complicated by rising ESG litigation risks. As noted in recent legal analyses, companies face increasing liability for misleading ESG disclosures [4]. While Sarepta’s 2023 report avoids overt greenwashing, its lack of detailed stakeholder feedback mechanisms leaves room for skepticism. Investors must weigh whether the company’s ESG narrative is robust enough to withstand scrutiny or if it risks becoming a reputational liability.

Strategic Implications for Investors

For long-term investors, Sarepta’s ESG strategy presents both opportunities and risks. On one hand, its commitment to sustainability and DEI positions it to benefit from ESG-driven capital flows and regulatory incentives. On the other, the Elevidys crisis highlights the fragility of stakeholder trust in the face of operational or safety failures.

A data visualization of Sarepta’s ESG initiatives versus its 2025 revenue projections (see