Can Wall Street tackle the sustainability challenges alone? The need for a supranational G on ESG

Abstract

This study examines how knowledge about Environmental, Social, and Governance (ESG) criteria serves as a proxy for their real influence, as the United Nations envisioned in 2004, in promoting sustainable and equitable development worldwide. It contributes to the ongoing intellectual debate about whether the incentives currently prevalent in financial markets are sufficient to yield tangible outcomes in the research community regarding the impact of ESG initiatives on advancing the 2030 Agenda. To this end, the project conducts a comprehensive analysis of knowledge generation related to ESG, using bibliometric techniques to examine both the foundational knowledge and emerging research trends. It advocates for the necessity of international stewardship to channel financial resources effectively to meet the Sustainable Development Goals (SDGs) outlined in the 2030 Agenda. Through a meticulous examination of the various layers of knowledge, the project concludes that while the connection between ESG initiatives and financial returns is well established, the broader goals of fostering sustainable and equitable development are not adequately reflected in the generation of ESG knowledge. This study identifies a significant gap between ESG theory and practice, suggesting that this could be bridged by a supranational entity that sets, monitors, and integrates an ESG framework.