This paper addresses the question: How can private finance be mobilized for sociotechnical sustainability transitions? In answering this question, maps the sustainability investment literature, which leads to four propositions: (1) The literature on sustainability investing coevolved with corporate social responsibility theory and with the practice and events of the field, revealing four distinctive waves of “sustainable investing”; (2) Each wave of sustainability investing triggers new investment strategies, while propelling preceding ones upwards (‘tidal effect’); (3) Sustainability investing strategies can be classified into certain categories, namely: (a) approach (top-down/ investment thesis or bottom-up/ valuation); (b) orientation (mitigating negative externalities or inducing positive externalities); (c) return on investment (from zero to risk-adjusted); and (4) We may be witnessing the emergence of a fifth wave of sustainability investing triggered by new research and practices on “impact investing”. We discuss these propositions against socio-technical sustainability transitions’ theory.
• Provides an overview of the evolution of the sustainability investing field of research and practice.
• Develops four propositions on how the sustainability investing field evolved.
• Discusses the propositions from a sociotechnical transition perspective.
• Calls for a bridging between the literature on sustainable investment and finance and sociotechnical transitions.
sustainability investing, financing transformative change, sociotechnical transitions