Wharton Pension Research Council Working Papers

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Working Paper

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Since its green shoots first emerged around fifty years ago, acceptance of environmental, social, and governance (ESG) considerations in institutional investing—especially at pension funds—has evolved with distinct shifts in investor preferences. This Pension Research Council volume traces these shifts and their implications, leading up to the present day. Our volume notes that investors have diverse reasons for devoting attention to ESG criteria when deciding where to invest their money. Some have had religious motives, such as Quakers who focus on values; this approach can offer some risk mitigation. Yet models that look at whether divestment actually changes behaviors of companies show that rarely occurs. So it is not always that screening and divestment bring about the changes that investors seek. Accordingly, this book offers a variety of distinct viewpoints from a variety of countries, on whether, how, and when ESG criteria should, and should not, drive pension fund investments.


ESG, sustainability, sustainable investing, pension funds

Working Paper Number


Copyright/Permission Statement

All findings, interpretations, and conclusions of this paper represent the views of the authors and not those of the Wharton School or the Pension Research Council. © 2021 Pension Research Council of the Wharton School of the University of Pennsylvania. All rights reserved.

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Economics Commons



Date Posted: 10 August 2021