ESG Investing and Investment Banking: A Sustainable Future?

ESG Investing and Investment Banking: A Sustainable Future?

Authors:

Aditi Upadhya

Bachelor of Business Administration Amity Business School

Amity University Lucknow Campus

(Dr.) Archana Sharma

Professor Amity Business School

Amity University Lucknow Campus

ESG (Environmental, Social, and Governance) investing has become a significant force in the financial industry, driven by growing awareness of sustainability issues and increasing demand from investors for responsible investment opportunities. As concerns over climate change, social justice, and corporate ethics continue to rise, investment banks are adapting by integrating ESG principles into their strategies. They are developing sustainable financial products, such as green bonds and impact funds, and incorporating ESG factors into risk assessment and decision-making processes. The shift toward ESG investing presents a range of opportunities, including long-term value creation, enhanced risk management, and alignment with regulatory frameworks aimed at promoting sustainability. Investors are recognizing that companies with strong ESG performance tend to demonstrate resilience, operational efficiency, and stakeholder trust, which can contribute to financial stability and growth. However, challenges persist, such as regulatory inconsistencies, concerns over greenwashing, and the lack of standardized ESG reporting metrics.