Epistemic Arbitrage and 'Good Ideas' in European Sustainable Finance: A Study of the Professional Networks behind Policy Change

Abstract

How to support sustainable development and mitigate climate change is key global challenge today. Following the global urgency of taking action, attention has been directed towards the potential of the finance sector to contribute to this development.
By examining the empirical case of EU Sustainable Finance expert, this thesis sets out to study how sustainable finance is governed and shaped at the transnational level. The research question is as follows: How do expert networks make authoritative claims in setting the Sustainable Finance agenda? In order to do so, this thesis takes a mixed methods approach, utilising a combination of social network analysis, sequence analysis and qualitative interviews.
Drawing on the IPE scholarship, the sociology of professions, and social network theory, this study shows how expert networks make authoritative claims in setting the Sustainable Finance agenda by drawing on expertise knowledge and engaging in epistemic arbitrage. In agreement with recent literature, this thesis shows that governance of EU Sustainable Finance takes place through a two-level network, where professionals and organisations compete and cooperate for issue control.
Moreover, this thesis shows that, as a result of growing demand for expertise knowledge in sustainable finance, a sustainable finance profession is emerging at the transnational level. I show that sustainable finance activism has undergone a professionalisation, where traditional NGO activism on the outside partly is replaced by corporate reformism on the inside. In conclusion, this thesis contributes to the IPE and sociology of professions literature by expanding the understanding of the role professional networks, epistemic arbitrage and ‘Good ideas’ in European Sustainable Finance and how expert networks can make authoritative claims in setting the Sustainable Finance agenda.