ESG Data Quality Becomes the Critical Bottleneck for Sustainable Investment

Despite growing demand for sustainable investment products, ESG data quality remained the most significant barrier to institutional capital allocation in Q4 2025 and early 2026. A CFA Institute survey found that 72% of institutional investors consider ESG data inconsistency and lack of standardization to be the primary impediment to increasing sustainable investment allocations. Regulatory data standards — ISSB, CSRD, and SEC disclosure rules — are converging to address this fragmentation.