Journal article

Authors list: Becker, MG; Martin, F; Walter, A

Publication year: 2022

Journal: Finance Research Letters

Volume number: 47

Issue number: Part B

ISSN: 1544-6123

eISSN: 1544-6131

DOI Link: https://doi.org/10.1016/j.frl.2022.102708

Publisher: Elsevier

Abstract: 
This paper analyzes the effect of the Sustainable Finance Disclosure Regulation (SFDR) on mutual funds and individual investors in the EU. First, we study whether affected funds increase their sustainability compared to a control group. Second, we examine if the regulation makes individual investors allocate more capital into more sustainable funds. In a difference -indifferences setting, we analyze the influence of the regulation on ESG fund scores and fund net inflows. Our results show that affected funds increase their sustainability rating after the policy intervention. Additionally, we find that a better ESG label leads to larger fund net inflows.

Harvard Citation style: Becker, M., Martin, F. and Walter, A. (2022) The power of ESG transparency: The effect of the new SFDR sustainability labels on mutual funds and individual investors, Finance Research Letters, 47(Part B), Article 102708. https://doi.org/10.1016/j.frl.2022.102708

APA Citation style: Becker, M., Martin, F., & Walter, A. (2022). The power of ESG transparency: The effect of the new SFDR sustainability labels on mutual funds and individual investors. Finance Research Letters. 47(Part B), Article 102708. https://doi.org/10.1016/j.frl.2022.102708