ESG Investing – An Evolving Paradigm of Sustainability and Returns

Author(s)	Gaurika Gupta
Country	India
Abstract	This paper examines the evolution, implementation, and impact of Environmental, Social, and Governance (ESG) investing in global financial markets. Drawing upon secondary data from international and Indian contexts, it explores ESG’s historical development, key reporting frameworks (UN PRI, GRI, SASB), and regional adoption trends across Europe, the United States, and Asia. The study assesses ESG’s influence on financial performance, risk mitigation, corporate accountability, and sector-specific practices in energy, manufacturing, and technology. While evidence suggests ESG integration can enhance long-term returns, reduce volatility, and strengthen stakeholder trust, the paper also highlights persistent challenges such as inconsistent rating methodologies, greenwashing, and profit–purpose trade-offs. Policy implications include the need for standardized global ESG metrics, enhanced disclosure regulations, and technological innovations in ESG analytics. The findings underscore that ESG investing is not merely an ethical choice but a strategic imperative, with the potential to redefine value creation in modern finance.
Keywords	ESG investing, sustainable finance, corporate governance, greenwashing, risk mitigation, UN PRI, GRI, SASB, financial performance
Field	Business Administration
Published In	Volume 7, Issue 4, July-August 2025
Published On	2025-08-23
DOI	https://doi.org/10.36948/ijfmr.2025.v07i04.54011

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