The digital industrial revolution continues to expand the global network of economies and societies. Nevertheless, difficulties of sustainability such as climate change and disruption have become more severe. Multi-stakeholders are crucially important to resolve difficulties posed to sustainability in global communities. Sustainable communities are expected to be constructed through competitive and cooperative schemes of multi-stakeholders. Sustainable global communities must reform centralized economies with top down systems and must move toward decentralized mechanisms known as bottom-up societies. Sustainable investment strategies to support environment, society and governance (ESG) presumably improve social welfare. The main findings presented herein are summarized as explained hereinafter. First, this article describes that multi-stakeholders can introduce a decentralized incentive scheme into global economies and can provide mathematical expressions of sustainable investment strategies. Secondly, the decentralized formulation described herein is used to evaluate the improvement of ESG initiatives by the decrease of social welfare losses. The formulation states mathematically relative relations among the investment strategies. Thirdly, this mathematical model explores the social welfare effects of initiatives to enhance standards, regulations, and legislations. Empirically, one finds that integration strategies have grown remarkably as a core part of social institutional reform for sustainability. Finally, initiatives to improve social evaluation by individuals who are excluded from market transaction are demonstrated to decrease social welfare losses greatly. These findings can promote initiatives to alleviate the disruption difficulties faced by communities.
Citation: Hiroshige Tanaka, Chiharu Tanaka. Sustainable investment strategies and a theoretical approach of multi-stakeholder communities[J]. Green Finance, 2022, 4(3): 329-346. doi: 10.3934/GF.2022016
The digital industrial revolution continues to expand the global network of economies and societies. Nevertheless, difficulties of sustainability such as climate change and disruption have become more severe. Multi-stakeholders are crucially important to resolve difficulties posed to sustainability in global communities. Sustainable communities are expected to be constructed through competitive and cooperative schemes of multi-stakeholders. Sustainable global communities must reform centralized economies with top down systems and must move toward decentralized mechanisms known as bottom-up societies. Sustainable investment strategies to support environment, society and governance (ESG) presumably improve social welfare. The main findings presented herein are summarized as explained hereinafter. First, this article describes that multi-stakeholders can introduce a decentralized incentive scheme into global economies and can provide mathematical expressions of sustainable investment strategies. Secondly, the decentralized formulation described herein is used to evaluate the improvement of ESG initiatives by the decrease of social welfare losses. The formulation states mathematically relative relations among the investment strategies. Thirdly, this mathematical model explores the social welfare effects of initiatives to enhance standards, regulations, and legislations. Empirically, one finds that integration strategies have grown remarkably as a core part of social institutional reform for sustainability. Finally, initiatives to improve social evaluation by individuals who are excluded from market transaction are demonstrated to decrease social welfare losses greatly. These findings can promote initiatives to alleviate the disruption difficulties faced by communities.
[1] | Andreoni J (1990) Impure Altruism and Donation to Public Goods: A Theory of Warm–Blow Giving. Econ J 100: 464–477. Available from: https://econweb.ucsd.edu/~jandreon/Publications/ej90.pdf |
[2] | Arrow KJ (1973) Social Responsibility and Economic Efficiency. Public Policy 21: 303–317. |
[3] | Baecker RM (2019) Computers and Society: Modern Perspectives. Oxford University Press, Oxford, UK. |
[4] | Cassiers I, Maréchal K, Méda ed D (2018) Post–growth Economics and Society: Exploring the Paths of a Social and Ecological Transition. Routledge, Abingdon, UK. |
[5] | Choudrie J, Tsatsou P, Kruria S (2018) Social Inclusion and Usability of ICT–Enable Services. Routledge, Abingdon, UK. |
[6] | Coase RH (1937) The characteristics of the Firm. Economica 4: 386–405. |
[7] | Global Sustainable investment Alliance (2013) Sustainable Investment Review 2012. Available from: https://apo.org.au/sites/default/files/resource-files/2013-01/apo-nid228346.pdf |
[8] | Global Sustainable Investment Alliance (2021) Global Sustainable Investment Review 2020. Available from: http://www.gsi-alliance.org/wp-content/uploads/2021/08/GSIR-20201.pdf |
[9] | Hindman M (2018) The Internet Trap: How the Digital Economy Builds Monopolies and Undermines Democracy. Princeton University Press, Princeton, USA. |
[10] | Mansell SF (2013) Capitalism, Corporation and the Social Contract: A Critique of Stakeholder Theory. Cambridge University Press, Cambridge, UK. |
[11] | Oskam JA (2019) The future of Airbnb and 'Sharing Economy': The Collaborative Consumption of our Cities. Channel View Publications, Bristol, UK. http://doi.org/10.21832/OSKAM/6737 |
[12] | Paus E ed (2018) Confronting Dystopia: The New Technological Revolution and the Future of Work. Cornel University Press, New York, USA. |
[13] | Pistor K (2019) The Code of Capital: How the Law Creates Wealth and Inequality, Princeton University, Princeton, USA. |
[14] | Richardson HW, Nam CW (2014) Shrinking Cities; A global perspective. Routledge, New York, USA. |
[15] | Rifkin J (2014) The Zero Marginal Cost Society: The internet of Things, The Collaborative Commons, and The Eclipse of Capitalism. St. Martin's Press, New York, USA. |
[16] | Roberts RD (1984) A Positive Model of Private Charity and Public Transfer. J Polit Econ 92: 136–148. http://dx.doi.org/10.1086/261212 doi: 10.1086/261212 |
[17] | Sciarelli M, Cosimato S, Landi G, et al. (2021) Socially responsible investment strategies for the transition towards sustainable development: The importance of integrating and communicating ESG. TQM J 33: 39–56. https://doi.org/10.1108/TQM–08–2020–0180 |
[18] | Tanaka H (2004) Kigyo no Syakaiteki Sekinin no Keizai Riron (Japanese; Theoretical Analysis for Corporate Social Responsibility). Chikyuu Kankyou Report (Japanese; Global Environmental Policy in Japan) 9: 1–9. |
[19] | Tanaka H (2016) The Sustainability Theorem in the ESG Mechanism. Long Financ London Accord, 1–29. Available from https://www.longfinance.net/programmes/sustainable–futures/london–accord/reports/the–sustainability–theorem–in–the–esg–mechanism/ |
[20] | Tanaka H (2017) Sustainability of Global Communities and Regional Risk Governance. Asia Pac J Reg Sci 1: 639–653. http://doi.org/10.1007/s41685–017–0057–x doi: 10.1007/s41685–017–0057–x |
[21] | Tanaka H (2018) Mechanism of Sustainability and Structure of Stakeholders in Regions. Financ Forum 7: 1–12. http://doi.org/10.18686/ff.v7i1 doi: 10.18686/ff.v7i1 |
[22] | Tanaka H (2019a) Rehabilitation of the Decentralization in the Centralizing Process of Global Communities. J Global Issues Solutions 19: 1–18. Available from: https://www.bwwsociety.org/journal/current/2019/may-june/rehabilitation-of-the-decentralization-in-the-centralizing-process-of-global-communities.htm |
[23] | Tanaka H (2019b) Innovation on the Digital Economies and Sustainability of the Global Communities. Ann Social Sci Manage Stud 4: 1–10. http://doi.org/10.1980/ASM.2019.04.555635 doi: 10.1980/ASM.2019.04.555635 |
[24] | Tanaka H (2019c) Sustainable Governance of Marine Stakeholders. Oceanogr Fish Open Access J 11: 1–4. http://doi.org/10.19080/OFOAJ.2019.11.555805 doi: 10.19080/OFOAJ.2019.11.555805 |
[25] | Tanaka H (2020a) Chinese sustainable framework in the digitalized global communities. Int J Econ Policy Stud 14: 327–336. http://doi.org/10.1007/s42495–020–00039–w doi: 10.1007/s42495–020–00039–w |
[26] | Tanaka H (2020b) Digital Revolution and Structural Reform of Stakeholders. J Global Issues Solutions 20: 1–7. Available from: https://bwwsociety.org/journal/current/2020/jan-feb/digital-reform-and-structural-reform-of-stakeholders.htm |
[27] | Tanaka H (2020c) Digital Economic and Social Systems to be Featured by Stakeholders. Ann Social Sci Manage Stud 5: 128–136. http://doi.org/10.1980/ASM.2020.05.555670 doi: 10.1980/ASM.2020.05.555670 |
[28] | Tanaka H (2021a) Green Bonds Issuance and Chinese Sustainable Governance. Long Financ London Accord 1–16. Available from https://www.longfinance.net/media/documents/Green_bonds_and_Chinese__Sustainable_Governance_.pdf; Accessed, 23 March, 2022. |
[29] | Tanaka H (2021b) Digital Industrial Revolution and an Index of Transaction Cost. Am J Novel Res Sci 8: 1–2. http://doi.org/10.31031/NRS.2021.08.000678 doi: 10.31031/NRS.2021.08.000678 |
[30] | Tanaka H, Tanaka C (2021c) Green Bonds Issuance and Stakeholders Governance. Ann Social Sci Manage Stud 6: 1–11. http://doi.org/10.1980/ASM.2021.06.555697 doi: 10.1980/ASM.2021.06.555697 |
[31] | Tanaka H (2022) Sustainable provision of medical services with radiation in digital industrial revolution, Ann Radiol Med Imaging 1: 1–8. Available from: http://scientificeminencegroup.com/articles/Sustainable-Provision-of-Medical.pdf |
[32] | Tirole J (2001) Corporate Governance. Econometrica 68: 1–35. |
[33] | Williamson OE (1975) Markets and Hierarchies: Analysis and Antitrust Implication. The Free Press. |
[34] | Williamson OE (1986) Economic Organization: Firms, Markets and Policy Control. Wheatsheaf Books, Brighton, UK. |
[35] | Williamson OE (ed) (1990) Industrial Organization. Edward Elgar Publishing, Cheltenham, UK. |
[36] | UNEP FI, Compact UNG (2012) Responsible Investment and Hedge Funds: A Discussion paper. Available from: https://www.unpri.org/download?ac=4155 |