Question

What is one reason that the number of sustainable finance regulations have increased so much since the early 2000s?

A. Pension funds and millennial investors are less interested in sustainable investing than other groups, but their investments require greater regulation.
B. People from all demographics want their investments to align with their values, and regulations have increased to support these investors.
C. Over recent years, companies have been voluntarily reporting on ESG metrics and that has increased the necessity for regulations.
D. Companies, more than shareholders, have pushed to increase regulations as their goal is to positively impact the planet.

Answer 1

The increase in sustainable finance regulations is due to the growing desire of investors to have their investments reflect their personal values, leading to higher demand for transparent ESG standards and practices. Therefore correct option is B

Step-by-step explanation:

One reason that the number of sustainable finance regulations has increased since the early 2000s is that people from all demographics want their investments to align with their values, and regulations have increased to support these investors. With a rising awareness of environmental, social, and governance (ESG) issues, more investors are using ESG standards to screen potential investments. This not only includes environmental criteria such as a company's impact on nature but also social criteria and governance, which involve examining a company's internal practices and relationships where it operates. As interest in sustainable investing grows, regulators have been prompted to develop more robust frameworks that ensure transparency and accountability, helping investors make informed decisions that reflect their values.