A look back at regulatory reset, investor communication, and the growing role of data infrastructure in wealth management
As we close out 2025, it’s tempting to frame the year in dramatic terms: the rise (or backlash) against ESG, the relentless hype around AI, or the supposed reinvention of wealth advice. But as we argued in our previous trends blog, the most meaningful changes in wealth and investment are not loud or theatrical but more structural.

Across both ESG and WealthTech, 2025 was less about invention and more about correction. Regulators reassessed what had become overly complex. Financial institutions shifted from experimentation to execution. And technology quietly moved from being a differentiator to being the infrastructure that credibility depends on. Looking back but also forward into 2026, three themes stand out.

ESG enters its “credibility phase”
Was 2025 a good year for ESG in finance? The honest answer is it was a necessary one.

Rather than expanding the ESG agenda, regulators and market participants spent the year reassessing it. Years of rapid rulemaking and well-intentioned disclosure requirements had produced an ecosystem that was complex, inconsistently applied, and difficult for investors to interpret. ESG information risked becoming a compliance exercise or, worse, a marketing label.

In response, policymakers began to course correct. In Europe, the review of the Sustainable Finance Disclosure Regulation (SFDR) explicitly acknowledged that sustainability disclosures had become confusing and prone to misuse. The direction of travel is now towards clearer categorisation, stronger antigreenwashing protections, and disclosures that investors can actually use.

The same logic is visible in the Corporate Sustainability Reporting Directive (CSRD) through the Omnibus initiative: higher reporting thresholds, simplified standards, and a renewed focus on proportionality. It has become clearer that credibility matters more than volume. This shift reflects a broader realisation across the industry: sophistication comes explaining better. Credible ESG frameworks are those that clearly articulate objectives, trade-offs, and limitations without requiring investors to navigate unnecessary complexity. As regulatory expectations evolve, the emphasis is moving toward proportionality and usability, because clarity is what enables informed decision-making. Complexity is often mistaken for depth, when in reality it creates friction and erodes confidence.

This marks an important shift in mindset. ESG is moving away from being narrative driven and towards being evidence driven. Success will be defined by whether sustainability objectives, trade-offs, and limitations are explained clearly and consistently.

For financial institutions, this is both a relief and a challenge. Shorter, more focused disclosures reduce noise, but they also raise the bar on data quality, governance, and explainability. If you say less, what you say has to be clear and correct.

Investorcentric ESG communication becomes nonnegotiable
One of the clearest lessons from recent years is that disclosure alone does not equal understanding.

Independent research, including Kidbrooke’s own studies, has repeatedly shown that many investment products still fail to provide ESG information in a way that investors can meaningfully access or compare. Exclusions are unclear. Benchmarks are missing. Data sources are opaque. And even when information exists, it is often buried in PDFs or presented inconsistently across channels. One of the most persistent misinterpretations in financial services is that investor disengagement signals indifference. In reality, when sustainability disclosures become dense, fragmented, or difficult to interpret, even well-intentioned transparency can work against trust rather than building it. Most customers are just overwhelmed by how information is presented.

This matters because the intent of ESG regulation is not to generate reports; it is to protect investors from being misled. The ongoing review of SFDR signals a shift towards more investorcentric communication: clearer sustainability objectives, more explicit statements of ambition, and disclosures that focus on decision useful content rather than exhaustive checklists. While the final legislative shape is still evolving, the direction is already influencing how firms prepare.

Looking into 2026, we expect this trend to accelerate. ESG communication will increasingly be judged by the same standards as performance and risk reporting: clarity, comparability, and consistency.

This also raises a practical question. If CSRD thresholds increase and fewer companies report underlying data, asset managers may need to rely more heavily on estimates and assumptions. In that environment, transparency about data sources, methodologies, and limitations becomes critical. Investors do not expect perfection, but they do expect honesty.

At Kidbrooke, we see this as a data and presentation challenge rather than a scoring problem. ESG information only becomes trustworthy when it can be reviewed, contextualised, and explained alongside performance, risk, and cost, not isolated in a sustainability appendix.

Technology shifts from “feature” to financial infrastructure
If ESG in 2025 was about simplification, WealthTech in 2025 was about maturation.

Despite the noise around AI, the most important changes had little to do with algorithms replacing advisors. Instead, firms invested in the foundations that make advice scalable: data aggregation, analytics, automation, and product curation. In other words, wealth advice is changing quietly but rapidly.

Digital players raised expectations for transparency and relevance, while traditional institutions became more disciplined about technology spend. The focus shifted from experimentation to building platforms that actually work at scale, across life stages and channels.

The same principle applies to how advice itself is delivered. Too often, financial guidance, including ESG-related insights, is still built on static, point-in-time data, rather than evolving client context. This creates gaps between what systems know and what clients experience. Modern infrastructure should absorb complexity through analytics and automation, enabling advice that reflects real life rather than isolated moments.

This shift is particularly relevant for ESG. As sustainability disclosures become shorter and more focused, technology increasingly determines whether firms can meet regulatory expectations without overwhelming advisors or investors. ESG data must be aggregated, validated, and presented consistently across factsheets, digital journeys, and advisor conversations.

In this sense, ESG is becoming a test case for financial infrastructure maturity.

At Kidbrooke, our work over the past year reflects this reality. Rather than building standalone ESG features or labels, we have focused on enabling institutions to manage and present ESG relevant investment data as part of a unified analytical fabric. That means consolidating market, product, and sustainability data, supporting lookthrough analysis, and ensuring that outputs are consistent across digital and humanled channels.

This approach aligns with a broader trend we expect to define 2026: technology becoming a visible part of trust. For many retail and mass affluent investors, the brand is no longer experienced primarily through a relationship manager, but through digital journeys. What they see on screen, how trade-offs are explained, how assumptions are disclosed, how quickly systems respond; all communicates competence or confusion.

When ESG, performance, and risk outputs tell the same story across channels, technology becomes proof of integrity rather than a black box.

Looking ahead: less noise, more substance
As we move into 2026, the common thread across ESG and WealthTech is restraint.

Regulators are simplifying rather than expanding. Institutions are building rather than experimenting. And technology is being judged less by novelty and more by whether it enables clear, consistent, and compliant outcomes.

For ESG, this is a healthy evolution. A smaller, more credible framework grounded in data quality and explainability stands a better chance of delivering on its original promise. For wealth management, it reinforces a lesson many firms have learned the hard way: scalable advice depends on infrastructure, not headlines. The next phase will not belong to those who talk the loudest about sustainability or AI, but to those who quietly get the data, analytics, and communication right.

That is where long-term trust is built.

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