Socially and environmentally responsible investment

This chapter, which draws on my long-standing scholarship in this field, examines howthe financial sector shapes the environmental performance of the economy, focusing on the ebullient movement for socially responsible investing (SRI). The principal thesisis that the financial sector has generally negative environmental connotations, bothin its own right and in regard to the companies it funds, and so far SRI’s influenceon improving the sector’s impact has been modest but is improving. The role of legalgovernance in facilitating and hindering SRI is assessed as a variable relevant to theinfluence of SRI