Investors and Sustainable Finance

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Abstract

We start by discussing what motivates investors to enter the sustainability field (section 11.2). We debate different reasons for their engagement, ranging from concerns for securing competitive returns to changes in the regulatory landscape and client demand. Next, we discuss how ESG factors are integrated into different asset classes. We first discuss how ESG considerations are integrated into equity investing (section 11.3). We then look at other ways to consider ESG-related information in investment decisions, focusing on impact investing and fixed income (section 11.4). Section 11.5 looks at how investors that already have invested in companies can improve these firms’ ESG performance, either via active engagement and dialogue or via voting on shareholder resolutions. Next, we discuss what different kinds of data can shape investors’ consideration of sustainability issues (section 11.6). Finally, we look at the new European legislation (Sustainable Finance Disclosure Regulation, SFDR) which requires investors to disclose the level of sustainability risks and adverse sustainability impacts associated with their investment decisions.
Original languageEnglish
Title of host publicationCorporate Sustainability : Managing Responsible Business in a Globalised World
EditorsAndreas Rasche, Mette Morsing, Jeremy Moon, Arno Kourula
Number of pages19
Place of PublicationCambridge
PublisherCambridge University Press
Publication date2023
Edition2
Pages207-225
Chapter11
ISBN (Print)9781009100403, 9781009114929
ISBN (Electronic)9781009118644
DOIs
Publication statusPublished - 2023

Keywords

  • Sustainable finance
  • Sustainable investing
  • ESG integration
  • Active ownership
  • Impact investing

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