The Consolidation of the ESG Rating Industry as an Enactment of Institutional Retrogression

Emma Avetisyan, Kai Hockerts

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The socially responsible investing (SRI) movement has been aiming to create lasting institutional change by infusing the investment sector with new norms and values. Environmental, social and governance (ESG) rating agencies have emerged in response to the needs of SRI actors for reliable data on the social performance of firms. Since 2005, the ESG rating industry has witnessed a number of national and cross-border consolidations. Based on a set of 37 interviews and secondary data, the paper explores the driving forces behind this consolidation as well as its impact. Our focus is on four ESG rating agencies, based in the United States, the United Kingdom, France and Switzerland. We conclude that in effect consolidation has at least partially resulted in institutional retrogression, whereby the traditional norms and values have reaffirmed their primacy, thereby somewhat negating the institutional change sought by the SRI movement. Copyright © 2016 John Wiley & Sons, Ltd and ERP Environment
Original languageEnglish
JournalBusiness Strategy and the Environment
Issue number3
Pages (from-to)316-330
Number of pages15
Publication statusPublished - Mar 2017


  • ESG rating agencies
  • industry consolidation
  • institutional retrogression
  • socially responsible investing

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