BU Law professor David Webber on the disappearing gap between social issues and investment risk:
“I think what we are seeing is people increasingly viewing the investment space as a forum for grappling with political issues,” Webber says. “The pressures of politics on investment are growing and they’re going to play an important part in twenty-first century markets.”
Webber characterizes these political pressures as either top down or bottom up. Top-down pressures are defined as demands on investment that come from political leaders. Top-down pressures might be seen, for example, in a government’s use of sovereign wealth funds—government-owned investment funds that may advance nationalist interests using their investment power. Bottom-up pressures may take the form of social movements enacting change through investment, like environmental activists pushing companies to divest from coal.