New York, December 11th, 2025 – Sustainable investing is entering a more demanding phase. Regulation is tightening but diverging across jurisdictions, physical climate impacts are increasingly shaping markets, and the public ESG debate is raising the bar for credible, defensible sustainability claims. The Investor Sustainability Pulse 2025, a new survey by Clarity AI, the leading global sustainability technology company, of more than 120 market participants across North America, EMEA, and APAC, shows that commitment to sustainable investing remains strong, but the complexity of delivering it is rising fast.
AI adoption is accelerating and trust will decide scale
Investors are turning to AI as a practical enabler of this next phase. 57.8% of respondents already use AI in sustainability or investment analysis or plan to adopt it within the next 12 months, signaling a shift from pilots to mainstream workflows. The leading application is sustainability data collection and processing (66.9%), reflecting the growing volume and fragmentation of information investors must handle to meet regulatory and client expectations.
But adoption at scale hinges on trust. Accuracy is the dominant concern (68.6%), followed by transparency and explainability (37.2%). Most respondents expect AI to augment analysts rather than replace them (59.5% vs 24.0%).
“Investors want AI to turn fragmented sustainability information into decision-useful insight, faster and more consistently across portfolios. But trust is the gatekeeper: if results can’t be verified and explained, they won’t scale. The next wave of adoption will go to tools investors can validate and stand behind,” said Lorenzo Saa, Chief Sustainability Officer at Clarity AI.
Regulation is fragmenting and preparedness is uneven
The survey shows regulation reshaping sustainable investing from the outside in, but firms face a mounting coordination challenge. Only 28.9% of investors say their organizations are fully prepared for 2026 sustainability disclosure requirements, while 56.2% report partial readiness or lack of preparedness. These responses were collected before the SFDR 2.0 proposal was published, and the subsequent overhaul is likely to add further near-term complexity as firms adapt to a shifting rulebook.
At the same time, 89% expect divergence across jurisdictions to complicate global investment strategies, underscoring that cross-framework comparability and consistent reporting are becoming strategic necessities, not just compliance tasks.
Climate risk is reshaping investment decisions
Climate risk is increasingly treated as a near-term investment variable rather than a distant scenario. Investors cite both transition risk (58.7%) and physical risk (50.4%) among top concerns, reflecting broader integration of climate assessment into portfolio decision-making.
Extreme events are already shifting market behavior: 55% say floods, wildfires, and heatwaves are affecting investment decisions more than in previous years, accelerating demand for analytics that capture near-term exposure and resilience across portfolios.
Sustainable demand holds, but the expectations are rising
Despite louder debate around ESG, investors expect demand for sustainable products to remain resilient. 51.2% anticipate increased client demand over the next year, while 39.7% expect it to stay stable.
What is changing is how firms communicate sustainability. Nearly two-thirds report adjusting language and positioning: 43.0% tailor messaging by market, 23.1% use alternative terms, and 12.4% limit communication altogether, reflecting a tougher environment for credibility and scrutiny.
“The next phase of sustainable investing is about accountability. Expectations are rising for corporates, investors, and policymakers alike, and sustainability can’t sit on the sidelines — it has to be integrated into investment decisions. AI will help investors keep pace, but only if it’s adopted strategically, with the right specialization and governance to earn trust at scale,” added Saa.
For more information or to access the full findings, please visit: https://clarity.ai
About Clarity AI
Clarity AI is the leading sustainability tech company, leveraging advanced technology and AI to provide data-driven environmental and social insights to investors, corporates, governments, and consumers. AI has been at the core of Clarity AI’s offering from the start, supporting a fully flexible set of data solutions, insights, analytics capabilities, and tools used for portfolio management, corporate research and engagement, benchmarking, regulatory reporting, online banking, and e-commerce.
Within the investment sector, Clarity AI serves a direct network of clients managing around $55 trillion in assets and includes firms like Nordea, Crédit Agricole, PGIM, or Santander. Our strategic partnerships with financial institutions such as BlackRock, BNP Paribas, Caceis, or SimCorp, allow thousands of users to access Clarity AI advanced data analytics capabilities through their usual investment platforms, ensuring a seamless workflow experience. Clarity AI has offices in Europe, North America, and the Middle East. For more information visit www.clarity.ai
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