Sustainable finance has increasingly moved from being a niche activity to a mainstream one, with many leading financial institutions committing themselves to sustainability goals. This book unpacks the key terms, concepts and debates – both theoretical and applied – that underpin sustainable finance.
Many leading investment institutions, including asset managers, pension funds and insurance companies, have made commitments to sustainable investment or to the delivery of sustainability goals alongside their investment objectives.
This mainstreaming of sustainable investment raises many important questions, such as the following:
- Do sustainable finance strategies lead to meaningful real-world change? Are fears about greenwashing justified?
- Does sustainable investment deliver better financial outcomes? And is it consistent with investors’ fiduciary duties?
- Can the sustainability data and ratings used in finance be trusted? Does sustainability information drive improved sustainability performance?
- How should sustainable investment be governed? What are the roles and responsibilities of public and private actors?
This book unpacks the key terms, concepts and debates – both theoretical and applied – that underpin sustainable investment. Through evidence-based analysis, it cuts through the hype to critically explore sustainable finance’s transformative potential as well as its limitations. In doing so, the book enables public policymakers, financial institutions, companies, civil society organisations and academics to engage in a more informed discussion about the contribution that sustainable investment can make to sustainability goals.
1. Introduction
2. Key Actors and Their Roles in the Investment System
3. Key Concepts in Sustainable Investment
4. Why Do We Disagree about
Sustainable Finance?
5. Is Sustainable Finance Consistent with Fiduciary
Duty?
6. Does Sustainable Investment Deliver Better Financial Outcomes?
7. Do
Sustainable Finance Investing Strategies Lead to Better Sustainability
Outcomes?
8. Are Public and Private Finance Delivering on the Goals of the
Paris Agreement?
9. Do Better Company Disclosures Lead to Better
Environmental Performance?
10. What Is the Value of Collective Action in
Sustainable Finance?
11. Can the Financial Sector Be Trusted? Greenwashing,
Greenhushing, and Greenwishing
12. Can the Information Provided by Data and
Ratings Providers Be Relied Upon?
13. Assessing the Effectiveness of
Sustainable Investment in the Global: South Gaps, Contestations and Ways
Forward
14. Building a More Sustainable Investment System
Rory Sullivan is CEO of Chronos Sustainability and Visiting Professor in Practice in the Department of Geography and Environment at the London School of Economics and Political Science (LSE). Rory has advised government agencies and regulators around the world, including in Australia, the UK, Peru, Colombia, South Africa, Malaysia and Thailand, on the development and implementation of sustainable finance policy. He has also advised many asset owners and asset managers on the development and implementation of their responsible investment and net zero strategies.
Richard Perkins is Associate Professor in the Department of Geography and Environment at the London School of Economics and Political Science (LSE) where he is Programme Director of the MSc Environmental Policy and Regulation. He is also Associate of the Centre for Economic Transition Expertise (CETEx) at the LSE. Richards research examines the growing role of financial and corporate actors in governing sustainability.
