The S.O.S (Sustainability of Sustainability) cents on the dollar: How fares the promise of investor-led sustainability?

The tide of global ESG investments has slowed in recent years, with 2024 marking the first year of net outflows from sustainability-focused equity funds. This trend is driven by accusations of a lack of clarity about whether the invested dollars are truly promoting sustainability; investigations suggest that only slightly more than half of this spending is directed towards sustainable companies. This shift is accompanied by a renewed focus on economic profit, as investors grow weary of the "politicisation of ESG".

Is there still a strong case for ESG or sustainability-focused investment? What works, what doesn’t, and what needs fixing?