The Key Role of Comparative Law and Economics in the Study of ESG

Abstract

In the legal and economic context, sustainability is of paramount importance, as it inspires regulators and
investors with their choices. Within this topic, ESG factors have been identified as a crucial factor, as well as
the current benchmark adopted by gatekeepers to assess the «quality» of the markets’ players. Because of the
relevance of the issue, lawmakers and authorities are providing operators with an increasing number of «hard»
and «soft» provisions, whose final goal is to make the system compliant with (the best) environmental, social
and governance standards. This paper offers a preliminary analysis of the importance of Comparative Law and
Economics (CLE) in the subject matter, and then a comparative study of (i) the legal frameworks and the case
law of different legal systems on ESG, as well as (ii) the markets’ outcomes, grounded on a cost-benefit analysis
of the investors’ behaviors. More particularly, the paper provides readers with a comparison between different
regulatory choices adopted by a selected number of legal systems, so to allow a clear comprehension of the topic,
of its cost and of its consequences, also in the light of competition between jurisdictions, and identification of
shared solutions amongst players.