Green or Greed? Examining the Realities of the ESG Investment Bubble

Abstract

This article conducts a rigorous examination of the fundamental nature and practical realities of Environmental, Social, and Governance (ESG) investments, systematically reviewing existing literature and research to underscore the ongoing discourse surrounding these investments. It acknowledges the considerable attention they have attracted in recent years, noting that ESG investments are regarded on one end of the spectrum as a sustainable and accountable form of financial engagement, promising long-term gains for investors. On the contrary, there is an emerging body of research suggesting that ESG investments might be nurturing a 'green bubble,' implying that the real benefits might not be as significant as they initially appear and could potentially introduce unexpected risks to investors. Additionally, the study methodically evaluates various determinants influencing ESG investments, which include technological innovations and policy changes, among others. In its conclusion, the paper presents a thorough and profound viewpoint, facilitating a deeper comprehension for individual investors, corporate bodies, and academic investigators of the complex practicalities and intertwined obstacles associated with ESG investments.