Keeping Ethical Investment Ethical: Regulatory Issues for Investing for Sustainability

By B. Richardson. 2009

257 citations recorded by the source corpus.

Regulation must target the financial sector, which often funds and profits from environmentally unsustainable development. In an era of global financial markets, the financial sector has a crucial impact on the state of the environment. The long-standing movement for ethically and socially responsible investment (SRI) has recently begun to advocate environmental standards for financiers. While this movement is gaining more adherents, it has increasingly justified responsible financing as a path to be prosperous, rather than virtuous. This trend partly owes to how financial institutions view their legal responsibilities. The business case motivations that now predominantly drive SRI are not sufficient to make the financial sector a means to sustainable development. Some modest legal reforms to improve the quality and extent of SRI have yet to make a tangible difference. A more ambitious strategy to promote SRI for environmental sustainability is possible, based on reforming the fiduciary duties of financial institutions. Such duties, tied to concrete performance standards, could make financiers invest in more ethically responsible ways. Other collateral reforms to financial markets, including improved corporate environmental reporting, are required to promote sustainability.

Subfields: Finance, Marketing, Strategy and Management

View Paper: https://www.semanticscholar.org/paper/56dcc82f0b3523289063c70da0dad839e2841023

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Citations in the corpus

Predictor of Business Students’ Attitudes Toward Sustainable Business Practices (2010, background): “Some authors also consider environmental sustainability as a part of social responsibility and ethics (Richardson, 2009; Schwartz and Carroll, 2008).”
Past, present, and future of sustainable finance: insights from big data analytics through machine learning of scholarly research (2022, unknown): “…2011; Friede et al., 2015; Halbritter & Dorﬂeit-ner, 2015; Himick, 2011; Nielsen & Noergaard, 2011), and ethical investing (Bauer et al., 2007; Belghitar et al., 2014; Chow et al., 2014; Pender & Brocchetto, 2011; Richardson, 2009; Säve-Söderbergh, 2010; von Wallis & Klein, 2015; Watson, 2011).”
Socially Responsible Investment and Fiduciary Duty: Putting the Freshfields Report into Perspective (2011, unknown): “ Richardson (2008a, 2008b, 2009) argues that a lot more needs to be done in terms of legal reforms to promote SRI on the part of institutional investors.”
Corporate Social Responsibility, Noise, and Stock Market Volatility (2012, background): “Even more pertinent to SRI, French regulations require national pension funds to adopt social and environmental investment criteria (Richardson, 2009).”
DOES ENVIRONMENTAL, SOCIAL AND GOVERNANCE PERFORMANCE INFLUENCE ECONOMIC PERFORMANCE? (2020, background): “Some scholars suggested that there is a positive relationship between considering the needs of stakeholders and financial and economic performance (Nekhili et al., 2019; Richardson, 2009; Tarmuji et al., 2016).”
Doing Well by Doing Good: A Systematic Review and Research Agenda for Sustainable Investment (2019, background): “How reliable is the valuation of a company based on ESG information? Capelle-Blancard & Monjon [12]; Czerwińska & Kaźmierkiewicz [40]; Crifo, Forget, & Teyssier [84]; Dembinski, Bonvin, Dommen, & Monnet [85]; Du Rietz [86]; Jansson & Biel [87]; Kolstad [88]; Richardson [89]; Schwartz [90]”
Ethical requirement and financial interest: a literature review on socially responsible investing (2015, background): “Richardson (2009) criticizes the ethical screening approach.”