With performance now taking precedence over purpose, some question whether ESG investing has quietly fallen off the radar. While it’s true that momentum has faded, I don’t believe ESG is finished—it’s simply evolving. As a relatively new concept, ESG needs a reset if it’s to remain relevant over the next decade. Younger investors are highly engaged with ESG issues, particularly climate change, but they lack the financial clout to significantly influence markets—at least for now. Until wealth shifts through inheritance or career progression, older generations continue to drive asset flows. For some in that group, ESG is still viewed—fairly or not—as a “woke” agenda prioritising ideology over returns. This presents a challenge for investment managers seeking to balance strong, client-focused outcomes with a growing divide in generational expectations around responsible investing.
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Is ESG dead? Not quite – but it is having a midlife crisis
ESG investing has undeniably lost momentum, with dwindling media attention and growing backlash, especially in the US. (Source: Money Marketing)
