Investing in Planetary Boundaries? Analysing Sustainable Investments of Sovereign Wealth Funds in Europe

Chapter 11 in Beate Sjåfjell, Roseanne Russell and Maja van der Velden (eds), Interdisciplinary Research for Sustainable Business: Perspectives of Women Business Scholars (Springer, in print 2022)

University of Oslo Faculty of Law Research Paper No. 2022-36

Posted: 11 Feb 2022

See all articles by Heidi Rapp Nilsen

Heidi Rapp Nilsen

Norwegian University of Science and Technology

Maria Jesus Munoz-Torres

Jaume I University

Elena Escrig Olmedo

Jaume I University

Date Written: February 11, 2022

Abstract

Sovereign wealth funds constitute the largest accumulation of capital in history. The integration of sustainable investment criteria in sovereign wealth funds is therefore crucial for the financial market's contribution to securing the functioning of Earth systems and thereby a safe operating space for humanity. Such an integration requires an interdisciplinary approach with contributions from both natural science and finance.
The main objective of this qualitative desk study is to analyse the profiles of the four sovereign wealth funds in Europe with the aim of illuminating their different commitments to sustainable investments, both in policy and in practice. More specifically, we discuss these funds’ contributions to global society staying within planetary boundaries. We use the concept of sustainable and responsible investment (SRI) to classify the funds into different generations of SRI funds, with a focus on the environmental sustainability part of SRI.
The results show that three of these four institutional investors in Europe are integrating SRI considerations into their investment strategies, and two of these sovereign wealth funds can be characterized as belonging to advanced generations of SRI funds. Climate change is the planetary boundary which is most integrated into the investment strategies, but there is still limited information about the effect of these strategies.

Keywords: sovereign wealth funds, planetary boundaries, sustainable and responsible investment (SRI), Europe

Suggested Citation

Nilsen, Heidi Rapp and Munoz-Torres, Maria Jesus and Olmedo, Elena Escrig, Investing in Planetary Boundaries? Analysing Sustainable Investments of Sovereign Wealth Funds in Europe (February 11, 2022). Chapter 11 in Beate Sjåfjell, Roseanne Russell and Maja van der Velden (eds), Interdisciplinary Research for Sustainable Business: Perspectives of Women Business Scholars (Springer, in print 2022), University of Oslo Faculty of Law Research Paper No. 2022-36, Available at SSRN: https://ssrn.com/abstract=4032665

Heidi Rapp Nilsen (Contact Author)

Norwegian University of Science and Technology ( email )

Trondheim, 7491
Norway

Maria Jesus Munoz-Torres

Jaume I University ( email )

Campus del Riu Sec
E-12071 Castello de la Plana, Castellón de la Plana 12071
Spain

Elena Escrig Olmedo

Jaume I University ( email )

Castellon
E-12071 Castello de la Plana, Castellón de la Plana 12071
Spain

HOME PAGE: http://www.uji.es/ES/departaments/cofin/estructura/personal/e@/22752?p_per_id=149293

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