Environmental, social and governance investment standardization: moving towards sustainable economy
-
Author(s)Alex PlastunLink to Linkedin: https://www.linkedin.com/pub/plastun-alexey/57/7bb/444/Link to ORCID Index: https://orcid.org/0000-0001-8208-7135
,
Inna MakarenkoLink to ORCID Index: https://orcid.org/0000-0001-7326-5374
,
Yulia YelnikovaLink to ORCID Index: https://orcid.org/0000-0002-8478-4716
,
Serhiy MakarenkoLink to ORCID Index: https://orcid.org/0000-0001-6455-3585
-
DOIhttp://dx.doi.org/10.21511/ee.10(1).2019.02
-
Article InfoVolume 10 2019, Issue #1, pp. 12-22
- Cited by
- 3494 Views
-
537 Downloads
This work is licensed under a
Creative Commons Attribution 4.0 International License
This paper is devoted to the investigation of environmental, social and governance investment (investment with ESG criterion) normative base in the context of standardization process in sustainable economy financing. Complexity of such standardization and the lack of commonly accepted regulations, indexes metrics are under discussions of scholars, which encourage the need for clear guidance in ESG investment. 651 sustainability rating products and more than 300 investment policy instruments in different countries show the need for classifying the ESG standards. The solution of this scientific and practical task is based on the developed ESG investment standards system classifications. Proposed classification incorporates such criteria as level of standards adoption, mandatory degree, sectorial specificity, degree of companies’ awareness of responsible activity, ensuring transparency and the benchmarks formation, creating the institutional support of the ESG investment standardization process in sustainable economy and making more grounded investment and regulatory decisions.
- Keywords
-
JEL Classification (Paper profile tab)Q00, Q01, G11
-
References20
-
Tables2
-
Figures5
-
- Figure 1. Standards distribution in the ESG investment sphere in the largest 50 countries in the world in 2016
- Figure 2. Sustainability products in 2017
- Figure 3. Structure of sustainability ratings issuers in 2017
- Figure 4. Target audience of sustainability ratings in 2017
- Figure 5. Criteria for the compilation of sustainability ratings in 2017
-
- Table 1. Countries’ experience in ESG investment process regulation
- Table 2. Key benchmarks in the ESG investment system
-
- Brunsson, N., & Jacobsson, B. (2000). A world of standards. Oxford: Oxford University Press.
- Cadman, T. (2011). Evaluating the governance of responsible investment institutions: an environmental and social perspective. Journal of Sustainable Finance and Investment, 1(1), 20-29.
- Cadman, T. (2012). The Legitimacy of ESG Standards as an Analytical Framework for Responsible Investment. In W. Vandekerckhove, J. Leys, K. Alm, B. Scholtens, S. Signori, H. Schäfer (Eds.) Responsible Investment in Times of Turmoil. Issues in Business Ethics, 31. Dordrecht: Springer.
- Carver, J. (2010). A Case for Global Governance Theory: Practitioners Avoid It, Academics Narrow It, the World Needs It. Corporate Governance: An International Review, 18(2), 149-157.
- Déjean, F., Gond J.-P., & Leca, B. (2004). Measuring the unmeasured: An institutional entrepreneur strategy in an emerging industry. Human Relations, 57, 741-764.
- GISR. (2017). Corporate Sustainability. ESG Ratings Products.
- Hawley, J., & Williams, A. (2005). Shifting Ground: Emerging Global Corporate-governance Standards and the Rise of Fiduciary Capitalism. Environment and Planning A: Economy and Space, 37(11), 1995-2013.
- Kerwer, D. (2005). Rules that many use: Standards and global regulation. Governance, 18(4), 611-632.
- Kurtz, L. (2008). Socially responsible investment and shareholder activism. In A. Crane, A. McWilliams, D. Matten, J. Moon & D. S. Siegel (Eds.), The Oxford Handbook of Corporate Social Responsibility (pp. 249-267). Oxford: Oxford University Press.
- Power, M. (1997). The audit society: Rituals of verification. New York: Oxford University Press.
- PRI. (2016a). Global guide to responsible investment regulation.
- PRI. (2016b). Responsible investment regulation map.
- Rivoli, P. (2003). Making a difference or making a statement? Finance research and socially responsible investment. Business Ethics Quarterly, 13(3), 271-287.
- Sandberg, J., Juravle, C., Hedesström, T. M., & Hamilton, I. (2009). The Heterogeneity of Socially Responsible Investment. Journal of Business Ethics, 87, 519.
- SHIFT. (2017). About GISR. Vision and Mission.
- Slager, R., Gond, J.-P., & Moon, J. (2012). Standardization as Institutional Work: The Regulatory Power of a Responsible Investment Standard. Organization Studies, 33(5-6), 763-790.
- UNEP, & World Bank. (2016). Roadmap for a sustainable financial system.
- UNEP FI, & Mercer. (2007). Demystifying Responsible Investment Performance.
- West, A. (2009). Corporate Governance Convergence and Moral Relativism. Corporate Governance: An International Review, 17(1), 107-119.
- Windolph, S. E. (2011). Assessing Corporate Sustainability through Ratings: Challenges and Their Causes. Journal of Environmental Sustainability, 1(1), 36-57.
-
The evolution-similarity matrix: an evolutionary psychology perspective on cross-cultural advertising
Lachezar Ivanov ,
Jordan Buck ,
Rory Sutherland
doi: http://dx.doi.org/10.21511/im.16(2).2020.12
Innovative Marketing Volume 16, 2020 Issue #2 pp. 159-167 Views: 2505 Downloads: 650 TO CITE АНОТАЦІЯCorrections to the article made on November 24, 2020
The standardization/adaptation debate in cross-cultural advertising is a topic on which little consensus prevails and which remains heavily discussed. Using evolutionary psychology, this paper presents a typology of advertising cues and explains their cross-cultural relevance and transportability. The paper highlights three distinct categories – human universals (evolved similarities), local adaptations (evolved differences), and local socialization (differences not due to evolution). The paper contributes to advertising theory by providing a meta-framework for the study of cross-cultural similarities and differences in the processing of advertising cues. It further assists advertising practice by delivering a framework aiding in cross-cultural advertising copy decisions. By raising the questions that the paper poses to develop the proposed typology categories, advertisers can identify which advertising cues are malleable by advertising and which are based on innate human preferences and are relatively stable. With that knowledge in hand, advertisers can decide when and to what extent to use a standardization approach versus an adaptation approach.
-
Standardization of sustainability reporting: rationale for better investment decision-making
Henry Mynhardt , Inna Makarenko ,
Alex Plastun
doi: http://dx.doi.org/10.21511/pmf.06(2).2017.01
Public and Municipal Finance Volume 6, 2017 Issue #2 pp. 7-15 Views: 2354 Downloads: 354 TO CITE АНОТАЦІЯThe role of sustainability reporting in investment decision-making is not clear and obvious. Despite the steady increase of such statements in corporate annual reports, the relationship between the sustainability reporting and the financial performance of companies is not always positive. The main problems of sustainability reporting nowadays are insufficient comparability of reporting, accuracy (lack of materiality, reliability and validity of indicators), lack of common approaches for its verification.
Synthesis of standardization and regulation features of sustainability reporting, which is provided in this paper in different dimensions (countries, regulators standards), allows to identify long-term trends of this reporting to ensure its quality during investment decision-making in traditional and responsible financial markets.
-
Net investment position and the stock market: The case of traditional and ESG indices
Jaroslav Slepecký , Anna Vorontsova ,
Alex Plastun ,
Inna Makarenko ,
Iryna Zhyhlei
doi: http://dx.doi.org/10.21511/imfi.19(2).2022.05
Investment Management and Financial Innovations Volume 19, 2022 Issue #2 pp. 51-66 Views: 688 Downloads: 266 TO CITE АНОТАЦІЯThis paper explores the influence of traditional and ESG stock market indices on a country’s net international investment position. To do this, different methods, including ANOVA analysis, multiply regression analysis, correlation analysis, VAR-analysis and R/S-analysis, as well as the Granger causality test, are applied to quarterly data on the net international investment position, traditional and ESG indices from Finland, Sweden, France, Spain and Ukraine over the period 2005–2021. The results of descriptive statistics show that ESG indices are more volatile than traditional, but these differences are statistically insignificant according to ANOVA analysis. Correlation analysis provides direct evidence that ESG indices are highly correlated with their traditional analogues (correlation level varies from 0.88 to 0.96). Regression analysis results show that traditional and ESG stock market indices have no significant impact on the net international investment position. ESG stock market indices and net international investment position data are persistent, and autoregressive models can be applied to these data sets. On average, Hurst exponent is above 0.75 for the case of ESG indices and above 0.85 for the net investment position. This paper provides recommendations to improve the responsible investment framework.
Acknowledgment
Alex Plastun gratefully acknowledges financial support from the Ministry of Education and Science of Ukraine (0121U100473).
