“Strong conviction, loosely held” has long been a mantra in the technology and venture community. The guidance speaks to the mindset that one should hold opinions with firm certainty while remaining open to changing perspectives when presented with new evidence.
Yet, in today’s turbulent political and economic landscape, where human rights and sustainability initiatives face unprecedented headwinds, there has been growing debate that such convictions might perhaps be too loosely held by impact investors.
Those of us committed to using capital to generate positive outcomes for both planet and people now stand at a critical inflection point. Amid deregulation, unpredictable tariffs, and executive orders actively targeting socially conscious business practices, there’s a real risk that pulling back from impact-focused initiatives could unravel decades of hard-won progress on society’s most pressing challenges.
In response to these new realities, some investors are advocating for “green hushing”—walking back or muting the centrality of social and environmental impact while continuing their work. Others are going so far as to change their strategy and investment approach entirely.
We are not here to judge; credible and principled arguments can be made for different approaches to public positioning, and every investor faces different internal and external dynamics they need to navigate.
However, we believe now is the time to hold conviction more strongly than ever. Impact venture funds are uniquely equipped for long-term success; in some respects, these headwinds play to our strengths and comparative advantages.
Responsible supply chains
This reality is evident in the field of responsible supply chains—the intersection of business and human rights where our Working Capital Fund operates. We launched with a clear mission: addressing human rights and sustainability risks in opaque global supply networks. In today’s hyper-connected economy, outsourced production and complex distribution channels make understanding, verifying, and managing environmental and labor conditions within extended supply chains extraordinarily difficult. Most corporate impact now happens indirectly through third-party suppliers, creating a troubling accountability gap. These complex, globally distributed networks have effectively outsourced not just production but responsibility.
Over the past decade, leading corporations, consumers, investors, and regulators have made meaningful strides to address these challenges. The 2011 UN Guiding Principles delineated corporate responsibility for human rights. This framework sparked important legislation—the California Transparency in Supply Chain Act, the UK Modern Slavery Act, the French Duty of Care Act, and most recently, the EU Corporate Sustainability Due Diligence Directive which took a critical step forward by actively mandated human rights due diligence requiring businesses to actively identify, prevent, and mitigate potential and actual adverse human rights impacts within their own operations and value chains.
2025 has brought a sobering pause in momentum and, more specifically, a reversal in the regulatory landscape. The gutting of the CSDDD, the closure of the US Bureau of Democracy, Human Rights and Labor, and other policy retreats signal a concerning shift away from mandatory accountability mechanisms. We’ve also seen corporate equivocation and a public retreat at a speed that we couldn’t have imagined —walking back net-zero commitments and sustainability pledges.
While things may seem daunting, we believe that Working Capital – and impact investors like us – are built to address the challenges of the moment and we’re convinced that now is the time to hold our conviction. And though each of our journeys as impact investors is unique, there are universal lessons to consider.
Collectively, we are addressing chronic, systemic problems that won’t conveniently disappear and are in dire need of new approaches and solutions. And when you’re solving meaningful problems that require new solutions, market demand inevitably follows—even if this truth sometimes gets obscured by short-term noise.
In our case we chose to tackle the challenge of opaque, unaccountable supply chains not because they’re trendy but because they represent fundamental flaws embedded in global trade architecture — flaws that negatively impact all stakeholders. Our current methods of sourcing, producing, and exchanging goods create negative externalities that ripple through the ecosystem. The root cause of these challenges is often broken and inefficient business processes that negatively impact the financial bottom line.
Streamlined, resilient, transparent supply chains deliver both business benefits and positive social and environmental impacts. They help companies mitigate disruption, manage tariffs, protect national security, secure access to essential materials, and strengthen market positioning.
Patient capital
Regardless of regulatory rollbacks, forward-thinking corporations with long-term vision recognize these fundamental realities. Policy tailwinds are nice and would have helped to accelerate solutions. But these are problems that will need to be solved long-term regardless. We continue to believe in the market’s transformative power to demonstrate innovative solutions and maintain that private capital is uniquely positioned to identify and scale innovative solutions in ways that the government cannot.
We also recognize that we can afford to be patient. Venture capital typically operates on ten-year horizons—sufficient time to weather political shifts, economic cycles, and cultural fluctuations. By maintaining our conviction, we can insulate ourselves from the noise and focus on our core mission and proven investment approach. For example, even if EV subsidies disappear or ESG investors retreat, it is abundantly clear that a transition to a green economy will strain critical mineral supply chains needed for lithium-ion batteries. Without new and better approaches environmental and human rights will worsen exponentially.
Similarly, climate change denialism aside, the inevitable impact of a hotter planet on the livelihoods of the most vulnerable will only grow more severe. We need to make long-term bets on new solutions to these problems now, knowing they will only grow more prominent—regardless of the current political climate.
The long-term view doesn’t mean that we — or our portfolio companies — don’t need to adapt tactically while holding firm strategically. Take our investment in Altana, which enables businesses to map their extended supply chains using AI to identify high-risk suppliers. While continuing to help major corporations navigate the human rights risks presented by legislation such as the Uyghur Forced Labor Prevention Act, Altana now also helps companies manage complex tariff regimes while simultaneously flagging goods produced through unethical practices or sourced from sanctioned suppliers.
Similarly, our company Prewave is helping corporations adapt to evolving EU regulations while continuing to assess environmental and social risks within supplier networks, including navigating complex policies like European Union Deforestation Regulation and Battery Passports.
And our most recent investment, in Radical AI, exemplifies how dual imperatives—national security and sustainability—can align. Radical AI addresses concerns around critical minerals by leveraging AI to accelerate material discovery—while reducing dependence on unethically sourced resources. We invested because we know that a green economy transition requires critical and rare earth minerals from supply chains already plagued with human rights and environmental abuses. Yet, with China threatening to restrict mineral exports in response to US tariffs (China controls most of the global production and processing), the business case for ethical alternatives has only strengthened.
We’re undaunted by the current sustainability headwinds and optimistic about contributing to the creation of a future world where responsible and ethical supply chains are the norm and we believe the same principles aiding us in our journey will apply to others in our impact investing community.
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Ed Marcum is Managing Partner of Working Capital Fund.
