The sustainability transparency index of sovereign wealth funds: their asset size, SDG country rankings and cross-region comparison

  • Received September 21, 2022;
    Accepted November 20, 2022;
    Published November 25, 2022
  • Author(s)
  • DOI
  • Article Info
    Volume 19 2022, Issue #4, pp. 218-231
  • Cited by
    4 articles

Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License

Sovereign wealth funds accumulate the largest resources to bridge the financial gap under the Sustainable Development Goals. The basic mechanism for accelerating sustainability progress is the effort of sovereign wealth funds to incorporate environmental, social, governance and ethical criteria and targets of these Goals disclosed in their sustainability reports. This study aims to develop a methodology for assessing the Sustainability Transparency Index in a sample of sovereign wealth funds, as well as to investigate how this transparency is influenced by the size of funds’ assets and sustainability progress with a cross-regional comparison. Five groups of sustainability disclosure metrics, such as the main pillars of novel Sustainability Transparency Index, were tested and analyzed for 91 funds using binary variables and normalization method. Three hypotheses regarding the statistical association of funds’ sustainability transparency index with the size of the funds’ assets, countries’ sustainability progress, and the region of a fund were checked for 87 funds using multiple regression. The overall results of the Sustainability Transparency Index show an insufficient level of funds’ transparency. Sustainability disclosure in 57% of funds surveyed should be fully enhanced in terms of greater sustainability transparency. There is strong evidence of the correlation between the volume of funds’ assets and sustainability transparency as well as the leadership of European funds in a cross-regional comparative study. However, data on the progress of the country’s sustainability and the funds’ Sustainability Transparency Index are limited and can be used as evidence of the insufficient role of fund transparency in promoting sustainability.

view full abstract hide full abstract
    • Table 1. Academic sources on SWF sustainability and financial performance
    • Table 2. STI scoring results
    • Table 3. Results of multiple regression assessments of the factors of SWFs’ sustainability transparency conduct
    • Table A1. Main principles of SWF transparency and sustainability
    • Table A2. Author’s questionnaire for SWF Sustainability Transparency Index STI
    • Funding acquisition
      Stefano Cavagnetto
    • Supervision
      Stefano Cavagnetto
    • Validation
      Stefano Cavagnetto, Václav Brož
    • Writing – review & editing
      Stefano Cavagnetto
    • Conceptualization
      Inna Makarenko
    • Data curation
      Inna Makarenko
    • Methodology
      Inna Makarenko, Václav Brož
    • Project administration
      Inna Makarenko
    • Resources
      Inna Makarenko, Lucie Rivera, Hanna Filatova
    • Writing – original draft
      Inna Makarenko, Václav Brož
    • Software
      Václav Brož, Hanna Filatova
    • Formal Analysis
      Lucie Rivera
    • Investigation
      Lucie Rivera, Hanna Filatova
    • Visualization
      Lucie Rivera, Hanna Filatova