Eleanor Fraser-Smith, Head of Sustainability at Victory Hill Capital Partners, says adaptive decision-making is essential to handling the messy, systemic realities of sustainability.
In the race to showcase climate credentials, companies and investors risk falling into what might be termed ‘greenskimming’. Unlike greenwashing, which implies deliberate intent to mislead, greenskimming stems from genuine ambition to ‘do the right thing’ without fully grappling with the messy, systemic realities of sustainability. The outcome is overconfident claims that unravel under scrutiny, leaving organisations exposed to reputational and regulatory risk.
We see this play out in multiple ways. Some Sustainable Finance Disclosure Regulation Article 8 funds might overstate their ‘impact’, glossing over hard constraints in their portfolios, while companies might find themselves making net zero pledges without mapping scope 3 supply chains. Voluntary carbon markets have amplified this problem. Buyers with the best of intentions purchase offsets, only to discover that projects, whether rainforest protection schemes or cookstove initiatives, prove ineffective or short-lived. So, what was intended as climate leadership becomes reputational liability.
Structural blind spots
Researchers and practitioners have warned of these structural blind spots. Morningstar Sustainalytics, for example, has highlighted the risks of ESG strategies that fail to consider systemic interdependencies, urging instead for frameworks that anticipate unintended outcomes.
Researchers have also described ‘crosswashing’, the practice of boosting ESG scores by making selective sustainable investments while leaving core operations unchanged. Even within ESG ratings themselves, inconsistencies are common: a company’s score can vary dramatically depending on the agency, with methodologies that cherry-pick achievements while masking trade-offs. The result is an overconfident narrative where sustainability appears simple and linear, when in fact it is anything but.
This isn’t to argue against ambition. Ambitious targets remain vital to driving progress. But systemic thinking does not mean trying to address everything at once. Prioritisation of material issues remains central to credible sustainability practice, and recognising what is less material is as important as identifying what matters most.
Credibility today requires a more mature mindset built on humility and transparency. Organisations must acknowledge uncertainty, admit trade-offs, and resist the temptation to present neat solutions where none exist. They must also continue to act despite incomplete information. Complexity should not be an excuse for paralysis: adaptive decision-making and accountability are central, and passive aspiration is not an adequate substitute for active choices.
True systemic thinking means recognising that renewable infrastructure depends on mineral supply chains with human rights and biodiversity implications. It means understanding that resilience planning cannot be confined to isolated assets or narrow risk assessments but must account for interconnected ecosystems and cascading shocks.
The need for clarity
At the same time, we need clarity about roles. Investors must balance fiduciary duty and long-term risk management; corporations must embed sustainability into strategy and operations; regulators must both enforce standards and provide supportive guardrails; and all are under pressure from stakeholders demanding credible progress.
Such an approach should not be seen as weakness. In fact, acknowledging complexity can strengthen both strategy and credibility. By admitting what we do not yet know, organisations can better anticipate risks and avoid the reputational pitfalls of greenskimming. In an era of ESG backlash and intensifying regulatory oversight, overconfident claims invite mistrust.
Exaggerated or premature statements are increasingly challenged by regulators, investors, journalists, employees and society at large, and the resulting reputational damage is not easy to undo. Regulation, however, can be a positive support system as well as a disciplinary measure – frameworks such as the EU Corporate Sustainable Reporting Directive, International Sustainability Standards Board, or UK Sustainable Disclosure Requirements regime can help provide clarity and comparability, as well as enforcing compliance.
Trust must also extend beyond investors and regulators to stakeholders often directly affected by transition decisions, such as employees, communities, civil society. Their perspectives, too, shape the legitimacy of corporate and investor action. This honesty is particularly important at a moment when simplistic narratives about ESG are being weaponised by critics who dismiss sustainability as greenwashing or unnecessary cost. The reality is more nuanced.
Sustainability is neither solved by quick fixes nor undermined by complexity. Instead, complexity is the reality that must be embraced if solutions are to be resilient, responsible, and real.
Candid conversations
Getting sustainability right therefore requires moving beyond the comfort of box-ticking metrics and towards more candid conversations. This means reporting with transparency where data is incomplete and acknowledging the compromises inherent in transition, as well as seizing opportunities rather than just avoiding risk.
Positive practice can be seen in companies developing credible transition plans, and in investors integrating biodiversity and human rights alongside climate into their risk management frameworks. Ambition remains essential, but ambition without humility can swiftly tip into greenskimming territory. By admitting what we don’t know yet but choosing to act with transparency anyway, organisations can contribute to a culture in which sustainability is treated with the seriousness and realism that it demands.
Sustainability will never be neat or easily contained, and nor should it be. By resisting the urge to simplify, by actively exercising agency and making accountable decisions, and by embracing the complexity at its heart, we give ourselves the best chance of making real progress uninhibited by the false comfort of linear solutions and absolute certainties.
Eleanor Fraser-Smith, Head of Sustainability at Victory Hill Capital Partners, says adaptive decision-making is essential to handling the messy, systemic realities of sustainability.
In the race to showcase climate credentials, companies and investors risk falling into what might be termed ‘greenskimming’. Unlike greenwashing, which implies deliberate intent to mislead, greenskimming stems from genuine ambition to ‘do the right thing’ without fully grappling with the messy, systemic realities of sustainability. The outcome is overconfident claims that unravel under scrutiny, leaving organisations exposed to reputational and regulatory risk.
We see this play out in multiple ways. Some Sustainable Finance Disclosure Regulation Article 8 funds might overstate their ‘impact’, glossing over hard constraints in their portfolios, while companies might find themselves making net zero pledges without mapping scope 3 supply chains. Voluntary carbon markets have amplified this problem. Buyers with the best of intentions purchase offsets, only to discover that projects, whether rainforest protection schemes or cookstove initiatives, prove ineffective or short-lived. So, what was intended as climate leadership becomes reputational liability.
Structural blind spots
Researchers and practitioners have warned of these structural blind spots. Morningstar Sustainalytics, for example, has highlighted the risks of ESG strategies that fail to consider systemic interdependencies, urging instead for frameworks that anticipate unintended outcomes.
Researchers have also described ‘crosswashing’, the practice of boosting ESG scores by making selective sustainable investments while leaving core operations unchanged. Even within ESG ratings themselves, inconsistencies are common: a company’s score can vary dramatically depending on the agency, with methodologies that cherry-pick achievements while masking trade-offs. The result is an overconfident narrative where sustainability appears simple and linear, when in fact it is anything but.
This isn’t to argue against ambition. Ambitious targets remain vital to driving progress. But systemic thinking does not mean trying to address everything at once. Prioritisation of material issues remains central to credible sustainability practice, and recognising what is less material is as important as identifying what matters most.
Credibility today requires a more mature mindset built on humility and transparency. Organisations must acknowledge uncertainty, admit trade-offs, and resist the temptation to present neat solutions where none exist. They must also continue to act despite incomplete information. Complexity should not be an excuse for paralysis: adaptive decision-making and accountability are central, and passive aspiration is not an adequate substitute for active choices.
True systemic thinking means recognising that renewable infrastructure depends on mineral supply chains with human rights and biodiversity implications. It means understanding that resilience planning cannot be confined to isolated assets or narrow risk assessments but must account for interconnected ecosystems and cascading shocks.
The need for clarity
At the same time, we need clarity about roles. Investors must balance fiduciary duty and long-term risk management; corporations must embed sustainability into strategy and operations; regulators must both enforce standards and provide supportive guardrails; and all are under pressure from stakeholders demanding credible progress.
Such an approach should not be seen as weakness. In fact, acknowledging complexity can strengthen both strategy and credibility. By admitting what we do not yet know, organisations can better anticipate risks and avoid the reputational pitfalls of greenskimming. In an era of ESG backlash and intensifying regulatory oversight, overconfident claims invite mistrust.
Exaggerated or premature statements are increasingly challenged by regulators, investors, journalists, employees and society at large, and the resulting reputational damage is not easy to undo. Regulation, however, can be a positive support system as well as a disciplinary measure – frameworks such as the EU Corporate Sustainable Reporting Directive, International Sustainability Standards Board, or UK Sustainable Disclosure Requirements regime can help provide clarity and comparability, as well as enforcing compliance.
Trust must also extend beyond investors and regulators to stakeholders often directly affected by transition decisions, such as employees, communities, civil society. Their perspectives, too, shape the legitimacy of corporate and investor action. This honesty is particularly important at a moment when simplistic narratives about ESG are being weaponised by critics who dismiss sustainability as greenwashing or unnecessary cost. The reality is more nuanced.
Sustainability is neither solved by quick fixes nor undermined by complexity. Instead, complexity is the reality that must be embraced if solutions are to be resilient, responsible, and real.
Candid conversations
Getting sustainability right therefore requires moving beyond the comfort of box-ticking metrics and towards more candid conversations. This means reporting with transparency where data is incomplete and acknowledging the compromises inherent in transition, as well as seizing opportunities rather than just avoiding risk.
Positive practice can be seen in companies developing credible transition plans, and in investors integrating biodiversity and human rights alongside climate into their risk management frameworks. Ambition remains essential, but ambition without humility can swiftly tip into greenskimming territory. By admitting what we don’t know yet but choosing to act with transparency anyway, organisations can contribute to a culture in which sustainability is treated with the seriousness and realism that it demands.
Sustainability will never be neat or easily contained, and nor should it be. By resisting the urge to simplify, by actively exercising agency and making accountable decisions, and by embracing the complexity at its heart, we give ourselves the best chance of making real progress uninhibited by the false comfort of linear solutions and absolute certainties.
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