City Hive's Bev Shah: Sustainable finance's troubling communication gap

Late last year, I attended a Worthstone event, where a presentation from CCLA Investment Management opened with a comparison that caught the room off guard.

Sustainable finance, it suggested, has started to resemble a clique - the financial equivalent of the Mean Girls who wear pink on Wednesdays. 

It said it is an area it can feel difficult to break into - not because it is deliberately exclusionary but because the standards, language and regulatory complexity create a high barrier to entry.

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It was a light-hearted moment but something important surfaced. Sustainable finance has developed its own vocabulary, frameworks and expectations at remarkable speed. 

There have been a number of regulations and disclosure requirements to try and break down these complexities and improve understanding, but this has only been rolled out over the past few years. 

The depth these now cover is certainly a strength but it can also make the field feel opaque to those trying to engage with it from the outside. 

If sustainable investing is to shape the future of finance, the challenge is not to lower standards but to make those standards easier to understand.

Clients want change

CCLA's data offered a useful reality check. When clients are asked what matters most to them, the top three things are: what they are paying, what they are earning and whether they trust the firm managing their money.

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These priorities show most clients are not looking for a label or a philosophy when they invest. They are looking for competence, reliability and good judgement. If their money can also contribute positively to the world, that is welcome in a way that reinforces, rather than detracts from, performance and stewardship.

This should not be read as a lack of concern for sustainability issues. When asked directly, concerns such as pollution, climate change and human rights abuses rank very highly. The disconnect is not about values, it is about how those values are translated into products and communicated.

Under the radar 

One of the most revealing points from the presentation was around engagement. Clients consistently respond well to the idea of investors actively working with companies to improve behaviour and outcomes. Engagement feels constructive and pragmatic, without the performance anxieties some associate with exclusions or thematic funds.

And yet many clients do not realise engagement is already happening on their behalf.

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This highlights a central challenge for sustainable finance. The industry has become highly fluent in frameworks, metrics and regulatory language - partly out of necessity, given the complexity of the rules it operates under. But that fluency does not always translate into clarity for clients.

This is not about dumbing things down. It is about translating expertise into plain language. Less focus on technical jargon and more emphasis on explaining, in simple terms, what was done, why it mattered and what changed as a result.

Trust a deciding factor

Another clear message from the data is that trust remains a higher priority for clients. That is a reminder of the responsibility that comes with positioning yourself as values-led.

Firms that put sustainability at the centre of their identity are held to a higher standard, not just in how they invest but in how they operate. Clients want to know that governance, culture and decision-making align with the values being promoted. They care about transparency, consistency and whether a firm behaves well when no one is watching.

This higher bar should not be seen as a burden but an opportunity. Firms that are open about how they work - not just what they sell - are better placed to earn long-term confidence and loyalty.

Beyond artificial divides

The industry often talks as though there are two distinct groups: ‘sustainable investors' and everyone else. In reality, the differences are far smaller than the labels suggest.

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Most clients want the same things: sensible returns, fair fees, clear explanations and trustworthy partners. Sustainability changes the emphasis, not the fundamentals. Framing sustainable investing as a separate tribe can make it feel more specialist - and more distant - than necessary.

Bringing it into standard practice means recognising it as a core element of responsible investing. Engagement should be discussed as a routine investment tool, impact should be demonstrated clearly rather than assumed and decisions should be explained in ways that invite understanding rather than require prior knowledge.

More open, more confident  

What made CCLA's presentation resonate was its willingness to acknowledge the gap between intention and perception. 

Sustainable finance is driven by committed, thoughtful professionals working within increasingly demanding regulatory and technical constraints. The next step is making that work easier for others to engage with.

This is not about diluting expertise or lowering expectations. It is about recognising high standards and clear communication can - and should - sit side by side. The field does not need fewer experts but more translators: people who can bridge complexity and clarity, regulation and relevance.

By connecting sustainable finance more explicitly to risk management, performance discipline and long-term value creation, it becomes easier to see it for what it is - not a theme or a niche, but a way of investing that belongs firmly in the mainstream.

Bev Shah is co-CEO at City Hive