The verdict is in: sustainable finance doesn't improve financial returns and very seldom  creates additional social value.  Mostly, it is pure market-based investment with a misleading label. As such, it relieves corporations and politicians from taking action on climate and social issues, while providing fat fees to asset managers. 

Find out how the sustainable finance industry works its magic. And how to revise the rules of the game to bring about a better balance between financial and social returns. 

Trillions of dollars have been invested  with the aim of making corporations "sustainable," ie  more socially and environmentally responsible. But Profit vs. Progress  shows conclusively -- in clear language written for a general audience -- that finance is the wrong tool for the job. 

Key findings of the book include:  

• ESG (for Environmental, Social and Governance)  promises to "Do well by doing good,"  but fails to do either

• Green Bonds are green in name only

• Voluntary carbon credits do not help the environment

• Pledges by many  large corporations to achieve net-zero carbon emissions are  greenwashing

• Microfinance  (small loans for poor people to run their businesses) does not alleviate poverty

• Impact-first investing generally delivers below-market financial returns

The failure of sustainable finance  doesn't come from moral failings or bad faith, and well-meaning investment strategies cannot reverse it. History tells us that only the political process, not the finance industry,  can raise the bar of corporate social responsibility.  Asking markets to do the job of governments is folly.  

Today, as in the Gilded Age, income inequality is devastatingly high and corporate concentration is choking productivity.  We took action then to make the system work better for all. We need to do so again.  

The book lays out a roadmap for a more sustainable, more productive corporate ecosystem, including:

• Restoring the critical role of organized labor

• Breaking up the highly concentrated asset management cartel

• Subsidizing impact-first investing to achieve scale  

• Making boards of directors more accountable 

 The author, Brad Swanson, brings a unique perspective to the topic as an adjunct finance professor, a veteran manager of sustainable funds with more than twenty years' experience, and a former diplomat.

Profit vs. Progress: Why Socially Responsible Investment Doesn’t Work and How to Fix It  is published by MIT Press.

Selected by Publishers Weekly