The ESG era is winding down. Politically retreating, commercially discredited, and increasingly abandoned by institutional investors, environmental, social, and governance investing has left behind a vacuum and a lesson: impact language without impact infrastructure does not work. Steven Libman, founder of Investing With Purpose™, argues that a better framework already exists—one built on faith-driven conviction and measurable community outcomes rather than vague labels.
For 15 years, Libman’s firm has built a multifamily investment model where community impact is an operating system, not a marketing claim. He acknowledges that ESG asked a crucial question—reminding investors that capital is not neutral—but says the execution collapsed under its own contradictions. “You could really slap an ESG label on almost anything,” Libman says. “But where was the measurable impact?”
The failure was structural. ESG tried to create a universal moral scorecard for a diverse investor base, becoming political and vague. Fund managers applied labels inconsistently, and investors had no reliable way to evaluate whether the designation meant anything. Returns confirmed the problem: a framework promising both good and competitive returns instead delivered below-benchmark performance with limited verifiable impact. For faith-driven investors, ESG had an additional flaw: it outsourced the definition of values to Wall Street. “Faith-driven investors do not need Wall Street to tell them what is good,” Libman says.
The alternative Libman describes treats community investment as upstream of financial performance, not as a cost layered on top. His firm’s on-site Purposed Care Initiative (PCI) drives measurable outcomes: turnover falls when residents feel cared for, delinquency improves, reputation scores rise, and staff morale strengthens. “Caring is not charity,” Libman says. “It is a strategy. Better communities create better assets, and better assets create better investments.”
This distinction changes the economics. ESG asked investors to trade returns for impact. The conviction-based model argues that genuine community investment produces both—and that the assumption of a tradeoff was always the flaw. Libman’s firm tracks standard real estate KPIs—net operating income, occupancy, expense ratios—alongside Key Care Indicators (KCIs): metrics tracking resident events, pastoral care connections, and acts of service. These are reported to investors alongside financial data, creating dual-track accountability that ESG funds never managed to build. “We do not want to be ESG with a cross on it,” Libman says. “We offer real disciplined investing with real underwriting and real returns, but coupled with real care and real accountability.”
With ESG in retreat, the space it occupied is genuinely open. Libman’s view on who should fill it is straightforward: investors with conviction, not consultants with acronyms. The better framework, he argues, is not complicated: biblical stewardship, transparency, purposed impact, and excellent investment discipline. Whether it gains traction beyond firms already operating with a faith-driven mandate remains to be seen—but the gap ESG has left is real, and the demand for something more rigorous is growing.
