This week in ESG
Here’s what’s been making the headlines in the world of sustainability and responsible investing this fortnight, and what advisers should know:
Key highlights for advisers
🌍 US exits the Paris Agreement
The US has formally exited the landmark climate agreement aimed at limiting global temperature rises. This is the second time the US has left the agreement, after exiting during Trump’s first term, before Joe Biden pulled the country back in.
🌊 North Sea wind ambitions ramp up
At the North Sea Summit in Hamburg, the UK and eight European nations agreed to jointly develop 100GW of offshore wind capacity. This builds on the 300GW pledge made in 2023 and reinforces Europe’s ambition to turn the North Sea into one of the world’s largest clean energy centres.
⚖️ ESG blacklisting rule overturned
A Texas judge has overturned a rule letting state entities blacklist investment firms for “boycotting” fossil fuels, declaring it unconstitutional.
📊 Net Zero targets stall
MSCI data shows 32% of companies globally have now set companywide Net Zero targets, with nearly 60% setting some form of climate goal. That progress has plateaued year-on-year, suggesting momentum has slowed, but importantly, it hasn’t reversed.
🔌 Google signs 15-year offshore wind deal
Google has signed a long-term power purchase agreement with German energy provider EnBW, supporting its 2030 Net Zero ambitions.
Spotlight - climate fund returns hit five year high
Source: MSCI Sustainability & Climate Research. Funds include equity, fixed income and multi-asset ETFs and mutual funds
Why this matters
The chart above shows climate-themed investment funds delivered a median return of over 12% in 2025, the highest calendar year median since 2021. The blue bars show the range of individual returns achieved each year, with the black dot representing the median across the sector.
The range of outcomes remains wide across equity, fixed income and multi-asset strategies. But despite geopolitical headwinds and a structural underweight to strong performing “dirty” sectors such as defence and mining, the sector proved resilient.
Last year’s performance was supported by a strong renewable energy sector, underpinned by:
- Continued global decarbonisation efforts
- Growing electricity demand from AI and data centres
- Long-term capital investment in clean infrastructure
2026 Let's Talk Markets webinars
The next Let's Talk Markets webinar takes place on Thursday, 5th March 2026, continuing our series of insights for the year ahead.
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This article is for financial professionals only. Any information contained within is of a general nature and should not be construed as a form of personal recommendation or financial advice. Nor is the information to be considered an offer or solicitation to deal in any financial instrument or to engage in any investment service or activity.
Parmenion accepts no duty of care or liability for loss arising from any person acting, or refraining from acting, as a result of any information contained within this article. All investment carries risk. The value of investments, and the income from them, can go down as well as up and investors may get back less than they put in. Past performance is not a reliable indicator of future returns.
