Accelerating the Transition Towards Sustainable Investing - Strategic Options for Investors, Corporations, and Other Key Stakeholders
Bernd Jan Sikken
Duisenberg School of Finance; World Economic Forum
July 21, 2011
World Economic Forum Paper
What are key pathways for investors, corporations, and other key stakeholders in the investment value chain to accelerate the transition towards sustainable investing?
Sustainable investing is defined as an investment approach that integrates long-term environmental, social, and governance (ESG) criteria into investment and ownership decision-making with the objective of generating superior risk-adjusted financial returns. These extra-financial criteria are used alongside traditional financial criteria such as cash flow and price-to-earnings ratios.
This paper explores both the key barriers to sustainable investing (at investor, corporate, system-wide level) as well as the strategic options to overcome those barriers. Strategic options have been defined in four categories: A. improve information, B. strengthen competencies, C. modify incentives, D. enhance governance.
Number of Pages in PDF File: 44
Keywords: sustainable investing, responsible investing, sustainable value creation, ESG
JEL Classification: G00
Date posted: July 21, 2011