Essays on Socially Responsible Investing and ESG Investing

About the Project

This project will form part of a self-funded PhD or Master of Research (Mres) programme within the Business School at Edinburgh Napier University, UK. Applications are welcome at both PhD and MRes levels, and candidates may apply on a full-time or part-time basis.

In recent decades, socially responsible investing (SRI) and environmental, social, and governance (ESG) investing have transitioned from niche approaches to mainstream investment strategies. As global concerns around climate change, corporate accountability, and social inequality intensify, investors are increasingly incorporating non-financial factors into investment decision-making processes. This shift reflects a broader realignment of priorities, where financial returns are no longer viewed in isolation from environmental and social impact.

SRI traditionally focused on value-based exclusions—such as avoiding investments in tobacco, weapons, or fossil fuels—whereas ESG investing represents a more nuanced, metrics-driven approach. ESG analysis assesses companies based on their environmental practices (e.g., carbon emissions), social policies (e.g., labour standards), and governance structures (e.g., board independence). Despite growing adoption, the effectiveness, consistency, and long-term impact of ESG strategies remain subjects of academic and practical debate.

This project will be about exploring the evolution, mechanisms, effectiveness, and limitations of SRI and ESG investing, with a particular focus on their impact on financial performance and investment decision-making.

The aim of this project is to critically examine the development and practical implications of SRI and ESG investing within global financial markets. Specific objectives include:

1. To trace the historical evolution of SRI and ESG investing and highlight the key differences between them.
2. To examine how ESG factors are integrated into modern portfolio management and asset allocation.
3. To analyse the empirical relationship between ESG integration and risk-adjusted investment performance.
4. To evaluate the consistency and reliability of ESG rating methodologies across providers.
5. To identify key challenges such as greenwashing, regulatory gaps, and data limitations, and propose directions for future research and practice.

This project will be guided by the following research questions:

• What are the theoretical and practical foundations of SRI and ESG investing?
• How do ESG-integrated portfolios perform relative to traditional investment portfolios?
• What are the methodological limitations of current ESG rating systems?
• How do institutional investors and asset managers interpret and apply ESG criteria?
• What regulatory frameworks and industry standards are emerging to guide ESG investing?

Academic Qualifications:

A first degree (at least a 2.1) ideally in Accounting, Finance and/or Economics with a good fundamental knowledge of investment analysis and portfolio management.

English Language Requirement:

IELTS score must be at least 6.5 (with no less than 6.0 in each of the four components), other equivalent qualifications will be accepted. Full details of the University’s policy are available online.

Essential Attributes:

• Experience of fundamental data analysis.
• Competent in basic asset pricing theories.
• Knowledge of investments, porfolios, SR investing, ESG investing.
• Good written and oral communication skills
• Strong motivation, with evidence of independent research skills relevant to the project
• Good time management

Desirable Attributes:

Knowledge of or desire to learn any programming languages such as Matlab, R, etc.

Funding Notes

This is an unfunded position

References

Friede, G., Busch, T., & Bassen, A. (2015). ESG and financial performance: aggregated evidence from more than 2000 empirical studies. Journal of Sustainable Finance & Investment.
Berg, F., Koelbel, J. F., & Rigobon, R. (2022). Aggregate confusion: The divergence of ESG ratings. Review of Finance.