Turning challenges into strategic advantages for your portfolio

Sustainable investing continues to evolve rapidly, shaped by higher scrutiny, rising expectations, and a more complex global risk environment. RepRisk’s recent webinar brought together senior voices from public markets, private equity, and private credit to discuss how sustainability is being embedded into investment decisions in 2026.

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Here are five key themes from the discussion that are highly relevant for asset managers navigating today’s market:

# 1. Sustainability integration is now a baseline expectation 

Across asset classes, panelists agreed that sustainability integration can no longer be treated as optional. While approaches vary – from light-touch integration to deeply embedded thematic strategies – investors are expected to understand and assess sustainability-related risks and opportunities as part of prudent investment decision-making. Ignoring sustainability data altogether is no longer viewed as credible by sophisticated asset owners, particularly in global capital markets.

Importantly, integration does not require a single prescribed model. What matters is clarity around how sustainability considerations are incorporated, why they are material, and how they influence risk-adjusted returns.

# 2. Materiality over labels: sustainability is just good business

Many of the issues labelled sustainability – such as workforce management, health and safety, supply chain resilience, and governance – have always been fundamental business drivers.

A case in point is the energy and infrastructure sector, where skilled labor is in chronic short supply. Priorities such as safety, workforce retention, and human capital management are core business practices, not sustainability add-ons. These factors are highly material, as they directly affect execution risk, service quality, and financial performance.

As companies scale and serve a broader customer base, the role of sustainability professionals becomes less about changing behavior and more about translating existing operational strengths into language that resonates with investors and stakeholders. Investors are no longer interested in sustainability as a lofty concept; their focus is on specific, financially material risks.

# 3. Data availability across private markets can be inconsistent

Despite increases in sustainability data availability, panelists emphasized that data quality and consistency remain uneven, particularly in private credit and private equity. Quantitative KPIs are not always available, and qualitative judgment remains essential.

Rather than viewing data gaps as a barrier, leading firms are using a mosaic approach – combining third-party intelligence, direct engagement, expert input, and internal analysis. In this context, robust processes and documentation are increasingly more important.

# 4. Value preservation matters as much as value creation

While much of the sustainable investing conversation has focused on value creation, panelists highlighted that many sustainability initiatives are fundamentally about value preservation. Climate-related physical risk, governance failures, and reputational controversies can all materially impact downside risk – particularly for lenders and long-term capital providers.

In public markets, balancing short-term market pressures with long-term sustainability objectives remains a challenge. Sustainability-focused strategies often behave differently from broad market benchmarks, especially over shorter time horizons. Periods of short-term underperformance are inevitable and must be contextualized within the long-term thesis.

# 5. Trust depends on transparency and execution

Investors want specifics. Both before investing and through consistent, credible reporting afterward. Clear articulation of sustainability objectives, material metrics, and limitations builds trust, especially in an environment of heightened greenwashing scrutiny.

Looking ahead, execution risk is emerging as a defining challenge. Many institutions have set ambitious sustainability targets for 2030 and beyond. The ability to deliver on those commitments – not just announce them – will increasingly differentiate leaders from laggards.

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