The legitimacy of ESG standards as an analytical framework for responsible investment

Edited book (chapter)


Cadman, Tim. 2011. "The legitimacy of ESG standards as an analytical framework for responsible investment." Vandekerckhove, Wim, Leys, Jos, Alm, Kristian, Scholtens, Bert, Signori, Silvana and Schafer, Henry (ed.) Responsible investing in times of turmoil. Dordrecht, Germany. Springer. pp. 35-53
Chapter Title

The legitimacy of ESG standards as an analytical framework for responsible investment

Book Chapter CategoryEdited book (chapter)
ERA Publisher ID3337
Book TitleResponsible investing in times of turmoil
Authors
AuthorCadman, Tim
EditorsVandekerckhove, Wim, Leys, Jos, Alm, Kristian, Scholtens, Bert, Signori, Silvana and Schafer, Henry
Page Range35-53
SeriesIssues in Business Ethics
Chapter Number3
Number of Pages19
Year2011
PublisherSpringer
Place of PublicationDordrecht, Germany
ISBN9789048193189
9789048193196
ISSN0925-6733
Digital Object Identifier (DOI)https://doi.org/10.1007/978-90-481-9319-6_3
Web Address (URL)http://www.springer.com/business+%26+management/finance/book/978-90-481-9318-9
Abstract

This chapter argues that environmental-social governance (ESG), of which responsible investment (RI) is now a leading example, is built around models of social-political interaction in which participation and deliberation are key structural and procedural components. This approach provides a more holistically legitimate basis to corporate governance, rather than current models of corporate social responsibility, which focus on one or two attributes (such as accountability or transparency). In the conception offered here, a broad range of institutional arrangements are linked to the structures and processes of 'good' governance. Using a hierarchical framework of principles, criteria and indicators, which places these arrangements in a coherent framework for assessment, it is then possible to evaluate institutional quality. This approach is contrasted with the current, more restricted set of criteria used at present. The chapter concludes with some observations on the legitimacy of contemporary RI, and calls for universal standards to ensure consistency of governance across the sector, thus avoiding future crises of confidence analogous to the GFC.

Keywordsgovernance; responsible investment; standards; legitimacy
ANZSRC Field of Research 2020350208. Investment and risk management
350799. Strategy, management and organisational behaviour not elsewhere classified
350107. Sustainability accounting and reporting
Public Notes

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Byline AffiliationsFaculty of Business and Law
Institution of OriginUniversity of Southern Queensland
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