An Austrian Take on ESG

Authors

DOI:

https://doi.org/10.30800/mises.2021.v9.1416

Keywords:

ESG, Socialist Calculation Debate, Agency, Entrepreneurship, Information Asymmetry

Abstract

This paper analyzes the contemporary debate about ESG – Environment, Social, Governance – using economic insights from Austrian Economics; particularly, on entrepreneurship, agency, and information asymmetry. These insights are contrasted to similar concepts in “mainstream” economics suggesting that the Austrian insight goes beyond them, first by stressing effectiveness in addition to efficiency and institutions in addition to law-likeliness. When applied to ESG, the Austrian insight portraits ESG as a special case of the socialist, or economic calculation debate causing misalignments between inter- and intrafirm goals, exacerbates agency problems and suffers from serious flaws in its conceptualization as well as methodology. Relying on entrepreneurship, however, could make ESG work. This paper, thus, applies Austrian economics to contemporary debates claiming that its insights provide a unique perspective but at the same time updating its research program.

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Author Biography

Henrique Schneider, Swiss Federation of Small and Medium Enterprises – Switzerland - Schwarztorstrasse

Henrique Schneider graduou-se em Economia na Suíça, Alemanha, Áustria, EUA e China. Ele economista-chefe da Associação Comercial Suíça SGV, em Berna, na Suíça. É articulista na imprensa diária e em publicações científicas sobre microeconomia, sistema monetário e inovação. Seus livros mais recentes são “Uber: Innovation in Society” e “Creative Destruction and the Sharing Economy”.

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Published

2021-12-20

How to Cite

1.
Schneider H. An Austrian Take on ESG. MisesJournal [Internet]. 2021Dec.20 [cited 2022Jun.29];9. Available from: https://revistamises.org.br/misesjournal/article/view/1416

Issue

Section

Special Issue 2021