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There shouldn't be any ESG.

Violating the E (Environment) should lead to fines to make up for environmental clean up. If severe enough there should be prison time for the responsible higher ups.

Drop the S and G. There are existing laws to for most of these.

Governments can use weapons embargoes to stop their defense contractors from selling to specific countries.

The problem is that it's not a binary choice, and the current situation in Israel is making it extremely difficult for regular institutions to work with defence businesses without avoiding damaging associations in public perception.

OTOH, arms are arms, and when the Ukraine war will (hopefully, someday) be over, the startups that are springing up now, some of which will become established companies by then, will start looking for new markets for their (defensive and offensive) arms developed and tested in Ukraine.