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At a time when ESG fund inflows are stalling and skepticism is rising, impact investing has largely been sidelined. Capital allocation for impact remains a fraction of overall institutional allocations, well under 5% of assets under management, according to the Global Impact Investing Network.1 But is that remotely enough to meet the scale of today’s sustainability challenges?
According to Dario Mangilli, Head of Sustainability at Impact SGR, the answer is no. In this episode of Sustainability Wired, he argues that impact investing must move from niche to norm—from a specialist asset class to a systemic investment approach embedded across strategies and sectors.
Dario’s case is grounded in a sharp critique of ESG’s limitations. He believes generalist ESG frameworks are too diluted to deliver real change and that regulatory progress has focused more on box-ticking than capital deployment.
Meanwhile, the climate data is unequivocal: according to satellite records from 2001 to 2023, we are on a much faster warming path than many models predicted, a trajectory that demands urgent, large-scale reallocation of capital. One recent Nature study confirms this acceleration, showing that the world could cross the 1.5°C threshold by the early 2030s unless emissions fall dramatically.2
But Dario’s vision isn’t about abandoning ESG. He calls for thematic, impact-led strategies tied to structural trends like energy transition, demographic shifts, and climate adaptation. For institutional investors, this is both an ethical pivot and a strategic imperative.
Listen now to hear the full conversation.
Key Moments
| 00:01 | Introduction |
| 02:22 | Dario’s path into sustainability & listed impact investing |
| 05:26 | Why impact must scale beyond private markets |
| 16:22 | The post-ESG shift: thematic investing as the new sustainable framework |
| 19:10 | Climate risks arriving faster than expected |
| 21:15 | Structural trends reshaping markets |
| 27:52 | Regulation that drives capital vs. regulation that drives compliance |
| 35:55 | A new operating model for sustainable investing |
| 42:38 | AI as a structural force, and a sustainability challenge |
| 47:40 | The art of sustainability |
| 51:31 | Closing statements |
Notable Quotes on Impact Investing
In this episode, Dario challenges the conventional boundaries of impact investing, arguing that it must move from the margins into the mainstream. He explores why ESG as a catch-all framework is no longer fit for purpose, how regulation has missed the mark by focusing on disclosure over capital deployment, and why investors urgently need to reassess their models in light of accelerating climate risks.
1. Impact Investing Must Evolve
Dario makes the case that impact investing must expand beyond private markets and niche allocations to become a mainstream, systemic investment strategy.
“Why do pension funds have to think about impact investing only for like 0.5%, 1% of their entire asset allocation? This is wrong. This is not a right way to think in a time of the existential challenges that we are facing. I’m definitely in favor of having impact investing transforming itself from like a niche asset class into a systematic investment approach that can be applied across any kind of investment strategy.”
2. Compliance Doesn’t Equal Capital Deployment
Regulation has driven box-ticking behavior rather than real change. Dario argues that unless rules lead to actual capital reallocation, they’re failing their purpose.
“Any regulation related to sustainable finance that leads to compliance but does not lead to capital deployment is useless…The SFDR, for example, managed to change the narrative, to reframe the way in which sustainability is integrated into investment decision-making. But most of the requirements were centered on disclosure, relying on a huge information asymmetry between the producer and the user. If regulation doesn’t mobilize capital, it’s not working.”
3. Generalist ESG Approaches Are Out, Thematic Impact Is In
Dario believes ESG has become too broad to be meaningful. The future lies in specialized, thematic approaches that align impact with structural trends.
“I have a strong conviction that ESG as a generalist approach is over. And maybe it’s [positive] in the sense that this may create the space for a new discourse, for a new narrative, around how we make sure that sustainability, the true sustainability, is here to transform the way our economies work in spite of hype that this topic may have or may not have in financial markets.”
4. Climate Risk Is Moving Faster Than Models Predicted
Dario notes that scientific data is revealing that our climate trajectory is accelerating faster than even the most alarming models had predicted and warns that investors are not prepared.
“According to the latest scientific evidence…we have been systematically underestimating physical risks in our modeling. If you look at satellite observations from 2001 to 2023, and you tried to feed them to the main climate models, you see that the only climate models that could be considered a good fit are the ones above 2.5 degrees. So we are running very, very fast towards a climate scenario that is extremely adverse.”
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