Sustainable Finance: Trends, Opportunities and Risks

Interest in sustainable finance—and any other investment supporting the creation of positive social and environmental effects—has grown over the last ten years. Following the global financial crisis, investors and policy makers reconsidered common financial schemes, business models and products through the lens of sustainability issues. Policy makers intercepted the growing trend and moved on with a set of new regulatory proposals. This was particularly true in the European Union where several regulations were proposed by the European Commission. Many of these issues are still open on both the theoretical and practical side. This chapter aims to summarize some of the main trends, opportunities and risks linked with sustainability and, in turn, with sustainable finance. The chapter is structured as follows. Section 11.2 outlines recent trends in sustainable finance. Section 11.3 discusses some of the main opportuni- ties and risks linked with sustainable finance