In partnership with JGU and BMBF | 22 Sep 2023
Investment behaviour in sustainable finance
Economic Consulting Team
Oxford Economics
To meet the 2050 climate targets, the global sustainability and climate goals will require massive public and private investments of more than 131 trillion euros. The transformation of the financial system towards sustainability is a prerequisite for achieving global goals such as the Paris Climate Agreement. To gain new insights for policymakers and the financial sector into the functioning and effects of sustainable investments by small retail investors, Oxford Economics and the Johannes Gutenberg-University Mainz jointly worked on the project “Investment behaviour in sustainable financial instruments: A Behavioural Experimental Analysis of ‘ESG Preferences’ and their Implications for Financial Institutions and Policy” (ESGInvest).
From a policy perspective, it is crucial to understand the preferences of retail investors regarding sustainable investments so that they can contribute to the achievement of the Paris Agreement. Only then can requirements for policy frameworks and financial products be developed that will effectively steer retail investment toward sustainable development in the long term.
Our project assessed the extent to which demand pressure from retail investors can help to effectively achieve more climate-friendly investments and what helpful measures to improve market transparency in this area might look like. To this end, we examined the sustainable investment demand of retail investors in a cross-national field experiment. We then analysed whether there are systematic differences between the considered countries. In addition, we investigated whether the sustainable preferences of retail investors can influence banks’ lending behaviour.
Finally, already-known challenges for the widespread demand for sustainable financial products were combined with the new findings from the project and discussions with experts. Based on this, we identified levers that could enable retail investors to become more involved in sustainability financing.
The research outputs are in German. Please refer to the following Blog article for a discussion of selected findings: LINK
This research project is being carried out in cooperation with:
Johannes Gutenberg Universität Mainz durchgefüht
Bundesministerium für Bildung und Forschung (BMBF)
The experts behind the research
Our Economic Consulting team are world leaders in quantitative economic analysis, working with clients around the globe and across sectors to build models, forecast markets and evaluate interventions using state-of-the art techniques. The lead consultants on this project were:
Johanna Neuhoff
Associate Director of Consulting
Hannah Zick
Economist
Jan Sun
Senior Economist
Talk to us
If you would like to find out more about the research or our capabilities, please fill out the form and tell us a little more about you and your interests. A member of the team will contact you as soon as possible.
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