In 2025’s final episode of Risk, Return and Responsibility, the monthly podcast from Sustainable Investor, former UK Pensions Minister Guy Opperman and Editorial Director Chris Hall are joined for an end-of-year reckoning by Dr Anthony Kirby, ex-Head of Regulation and Risk for Asset Management and Capital Markets in Europe at EY.

Together, they review 2025’s big themes and give their views on the questions that will determine sustainable investment returns and impacts 2026:

Is the ESG backlash gathering speed or petering out? With Donald Trump returning to the White House, new hurdles hampered investor scrutiny, while the Inflation Reduction Act was dismantled alongside many a diversity, equity and inclusion initiative. Meanwhile Europe took a scythe to sustainable investment regulation, as finance sector net zero commitments withered. Asset owners dug in, further integrating sustainability into their investment processes and doubling down on oversight of material financial risks - but do they need to do a better job of explaining and delivering outcomes?

Is the divide between asset owners and managers bigger than the Atlantic? Already under huge political and legal pressure, US asset managers faced even greater difficulties in 2025 - with new rules from the Securities and Exchange Commission making it harder to engage with portfolio companies, just as European asset owners underlined their commitment to climate stewardship. The fallout has been measured in lost mandates, but could litigation and retrenchment be on their way in 2026? Effective stewardship of assets could depend on a closing of gaps in both investment horizons and business cultures.

Can private markets deliver both returns and impact at an attractive cost? Institutional investors are increasingly turning to alternative assets to achieve tangible sustainable outcomes as well as superior returns. In markets such as the UK, governments also expect asset owners to achieve the scale to leverage these channels to drive growth too. In response, managers must deliver clear evidence that sustainable business models are driving value creation at every stage of the investment process. Are their reporting cycles, stewardship capabilities, cost and fund structures up to the job?

Will supply meet demand for nature-positive investment opportunities? Nature became a critical stewardship priority for asset owners in 2025 against a backdrop of mixed policy outcomes across plastic pollution, deforestation, and ocean protection. COP30 helped to put nature-related investments on the agenda as asset owners looked beyond measuring and managing risk to seeking out opportunities for returns. Will we see dedicated nature funds or rather nature being fully embedded into a wider range of investment decisions, with impact investment solutions remaining niche for now?

Can the upsides of the AI boom survive the downsides of a bust? Hopes for transformative productivity gains from AI innovation have allowed markets to face down all headwinds in 2025. Even so, investors wonder when returns will justify capex and whether ESG risks will be addressed. Despite the rising valuations, careful analysis is needed to invest in AI, its infrastructure and supply chain - and to identify the sectors using the technology to deliver higher returns. 2026 could also see more asset owners and managers deploying AI to deliver new insights into sustainability-related risks and opportunities.

What does financial wellbeing really mean for pension members today?

For the latest episode of Sustainable Investor, Stuart Hall, Managing Director of Sustainable Media Group sat down with Blake Allison, founder and CEO of LifeCents, to look beyond the slogans and into the reality of how people behave with money.

Blake has spent more than twenty years working with major US employers and financial institutions on financial wellbeing programmes. What stood out in our discussion is how often the industry focuses on account balances and contribution rates, while members are dealing with day to day pressures that make long term decisions far harder than we admit.

We talked about: • why financial wellbeing has moved beyond information and apps • what under 35s actually prioritise when money is tight • the growing gap in retirement readiness for over 50s • how members really think about sustainability and returns • why generic “save more” messages no longer work • and how pension funds can rebuild trust by treating people as people, not data points

Blake’s perspective is practical and grounded, and it challenges some of the assumptions we make as an industry.

If you work in pensions, asset management or financial wellbeing, this conversation is worth your time. Visit LifeCents to find out more: LifeCents | Audience – Asset Managers

In this ‘interview-only’ episode, we explore the role of Australia’s superannuation funds in the country’s embrace of clean energy, with Jeremy Cooper and David Bell of the Conexus Institute.

Risk, Return and Responsibility – the monthly podcast from Sustainable Investor – aims to provide institutional asset owners with news and views shaping both the sustainable investment landscape and our wider economic, environmental and social systems.

In this episode, Guy Opperman, the UK’s longest-serving Pensions Minister & Chair of Sustainable Investor’s editorial board, reports from Sydney, on the barriers facing Australia’s US$2.8 trillion superannuation sector in supporting the country’s net zero transition.

In discussion with David Bell and Jeremy Cooper of the Conexus Institute, Guy finds out whether regulation and policy are giving supers the right incentives to invest sustainably, why so much capital is flowing into overseas infrastructure, and how Australia’s path to net zero could be different from other developed economies.

Guests: David Bell, Executive Director, Conexus Institute, a research organisation focused on improving Australia’s superannuation and retirement systems, and a former CIO of Mine Super. Jeremy Cooper, Chair of the Advisory Board, Conexus Institute, former deputy chair of the Australian Securities and Investments Commission (ASIC), Australia’s financial regulator and author of the government’s review of the super system.

Interview highlights:

• What are Australian pension funds and their regulators getting right – and wrong – about sustainable investing? Regulators have issued strong guidance on managing climate risk, and mandatory disclosures start next year. Yet, with no legal mandate or firm targets, super funds face little official pressure to decarbonise portfolios despite high public expectations.
• Why are funds not investing locally to reduce emissions? Despite vast renewable potential, most Australian super funds still prefer overseas infrastructure, particularly in the UK. A limited pipeline of investable domestic projects and benchmark-driven performance tests deter local climate investment, sending capital offshore while Australia needs it most.
• Can Australia reach net zero on renewables alone – and become a clean energy exporter? According to Jeremy Cooper, abundant solar, strong wind and the world’s largest batteries mean Australia could meet its energy needs without nuclear. Major solar and hydrogen projects in the Northern Territory point to a future where Australia powers both itself and its neighbours with renewables.
• Will government policy help decarbonise – including through a transition taxonomy? The government’s proposed transition taxonomy and investment incentives aim to crowd in private capital, but progress is slow. Super funds still lack transition plans and consistent carbon pricing, and clear policy signals are needed to unlock large-scale green investment.
• What can other countries learn from Australia’s pension system? David Bell notes that Australia’s experience shows how performance tests and value-for-money rules can unintentionally discourage climate-aligned investment. The lesson for others: build forward-looking frameworks that reward long-term sustainability, not just short-term returns.

Thanks for joining us: If you like what you hear, you can also subscribe to Sustainable Investor, subscribe to this podcast, where you can also find our contact details. We’d love to hear your ideas as we plan future episodes.

For more info or to sponsor contact chis.hall@sustainabletimes.co.uk