Abstract

Sustainability has become a pivotal issue in global finance, shaping investment decisions across sectors. However, skepticism remains: do financiers genuinely prioritize sustainability, or is it merely a strategic response to evolving market trends and regulatory pressures? Recent research presents a nuanced view. While sustainability has attracted substantial investor interest, the motivations behind these investments are not always clear-cut. A study by Hartzmark and Sussman found that mutual funds with high sustainability ratings experienced significant inflows, exceeding $24 billion, whereas those rated as low sustainability faced outflows of more than $12 billion. This suggests that investors perceive sustainability positively, often associating it with lower risk and higher long-term returns. However, empirical data reveal no consistent correlation between sustainability ratings and financial outperformance, indicating that investor enthusiasm may be driven more by non-financial motives than by purely rational economic expectations