EMBRACING CHANGE: THE ROLE OF INVESTMENT FUNDS IN INTEGRATING SUSTAINABILITY AND FOSTERING ECONOMIC GROWTH

Abstract

The financial sector is evolving in response to significant social challenges, transitioning from traditional profit-focused investment approaches to strategies that prioritize long-term value and sustainability. This shift is driven by a growing awareness of climate change and social issues, along with the understanding that long-term economic success hinges on sustainable development (Bocken, 2015). This study aims at examining how investors in the Swedish market prioritize and integrate ESG factors to assess the associated risks and opportunities in investment objects. It further seeks to analyze how these assessments, along with sustainability awareness and demands for sustainable operations, influence business practices across the Swedish market, contributing to sustainable development. This study employs a qualitative interview methodology and examines seven investment funds selected for their expertise in ESG principles, providing a rich, in-depth context for analyzing effective sustainability strategies and offering detailed insights on ESG-related risk criteria. The results highlight a notable shift towards sustainable finance, emphasizing long-term environmental, social, and economic well-being over immediate financial returns. The findings indicate that sustainability has become a core principle in investment decisions, driven by ethical considerations, legislation, and a commitment to sustainable development. The analysis underscores the transformative potential of sustainable investment strategies in fostering a resilient economy and promoting responsible business practices.