Devil’s Advocate or Agenda Setter? The Role of Journalists Covering Sustainable Finance in Europe

ABSTRACT

Although sustainable finance (SF) has entered mainstream in the financial markets, the public remains fairly uninformed about the trend and its controversies. To understand the role of the news media vis-à-vis the public discourse of SF, 33 interviews with journalists in six European countries (AT, BE, CH, DE, NL, UK) were conducted. Results indicate that most journalists acknowledge the agenda-setting function of the media but perceive their influence in engaging the broader public as limited. If at all, journalists from financial news and specialized trade news outlets ascribe themselves a mediating function in influencing decision-making processes among the powerful elite. Despite journalists' overall vast criticism towards SF (“greenwashing”), the majority of journalists seemed to remain in an information transmitter and conveyer role. Challenges such as the complexity and dryness of the topic, missing conflicts, the announcement phase of commitments or lacking resources are mentioned as main obstacles that inhibit SF coverage to reach a mainstream audience beyond the financial sector.

KEYWORDS:

• Sustainable finance
• agenda-setting
• journalism
• news media
• watchdog
• greenwashing

The public discourse in the Western media has presented the issue of climate change in various ways in the past decades (Nisbet 2009) but more recent discussions—particularly in the financial sector—have shifted the focus on how finance and capital can be used to effectively fight climate change. Coined with the term “Sustainable Finance” (SF), scholars and experts argue that finance works as a leverage in channelling capital into sustainable investments that will help to achieve the United Nations Sustainable Development Goals (SDGs) by 2030 (United Nations 2020) and the Paris agreement to limit the increase of global average temperature to well below 2°C. Prominent public figures (e.g., Mark Carney, Bill McKibbey, Al Gore) have openly expressed their support for sustainable investments and the re-structuring of financial flows to lower carbon emissions and to work towards a climate-neutral economy (e.g., Binnie 2019). In fact, the financial industry has witnessed a strong increase in sustainable investments the past years (Bioy et al. 2020), and more currently as a result of capital shifting during the Covid-19 pandemic (Nauman 2020). However, there is also an underlying criticism being raised against SF with various actors being vocal in questioning the validity, reliability, and honesty of SF activities in the financial system (e.g., Dupre and Roa 2019; Fancy 2021; Paetzold, Busch, and Chesney 2015).

While the Western news media occasionally report about some of these developments in the financial sector more broadly, news stories related to SF present a niche topic for mainstream news, and the broader public remains fairly uninformed about SF and its controversies (Ferrando and Tischer 2020; Deutsches Institut für Altersvorsorge 2020). Given the significant discrepancy between the wide-reaching market trend of SF in the financial sector on the one hand, and the need to inform, involve and empower citizens and private investors on the other hand (EU HLEG 2018), the question arises to what extent the news media have the potential to raise more awareness and scrutiny with regard to SF among the news readership. To understand the role of the news media vis-à-vis the public discussion of SF in more depth, 33 interviews with journalists in Austria, Belgium, Germany, the Netherlands, Switzerland, and the UK were conducted. The interviews were analysed regarding the questions to what extent journalists ascribe themselves the power to influence or change the public debate about SF, how they evaluate the discussion about SF (and particularly with regard to climate change), and what challenges they face when reporting about SF.

Literature Review

Sustainable Finance and the Role of Financial Journalists as Watchdogs

Research and data from the past decade has shown that individuals, societies, governments, and businesses need to drastically change their behavior in order to mitigate climate change (IPCC 2018). One of the major leverages that has been identified by governmental officials, activists and environmentalists alike in recent days is “Sustainable Finance” (SF). It is argued that by shifting capital into low carbon-emission industries (e.g., renewable energies), divesting from brown industries (fossil fuel, gas, coal), and channeling liquidity to projects that adhere to environmental, social and governance (ESG) criteria, global warming, and thus environmental disasters, can be mitigated (EU HLEG 2020; Suttor-Sorel and Hercelin 2020). The debate about SF, however, has so far mainly resided in elite and financial circles, and the broader public and civic society has been mostly excluded (Ferrando and Tischer 2020). A recent representative survey by Deutsches Institut für Altersvorsorge (German Institute for Pension Schemes) among the German population, for example, has shown that knowledge about SF is generally low and insufficient. About 50% did not know what SF is about.

This low awareness for SF among the public is worrisome, as current developments on the market also pose the issue of “greenwashing” (Riding 2019), and thus the danger of selling seemingly “green” financial products to an unaware, uninformed public. In fact, a recent op-ed by a former chief investment officer for sustainable investing at the world's largest asset manager BlackRock accused Wall Street of greenwashing, saying that “existing mutual funds are cynically rebranded as “green”—with no discernible change to the fund itself or its underlying strategies—simply for the sake of appearances and marketing purposes” (Fancy 2021). In line with such industry insights, the investor-led initiative Climate Action 100+ has found that although many companies (which are partly included in sustainable investments funds) are making ambitious climate pledges and commitments (e.g., net-zero by 2050), only few companies have clear short-term (up to 2025) or medium-term (2026–2035) targets on how to achieve those climate goals (Climate Action 100+ 2021).

What is more, an analysis by the “2 Degrees Investing Initiative” found that 85% of green themed funds make “unsubstantiated and misleading impact-related claims that violate existing market regulations” (Dupre and Roa 2019, 4), and Olatubosun and Nyazenga (2019) have found responsible investment practices in Zimbabwe being used as a symbolic marketing tool. These recent findings are in line with past criticism that has been raised by various scholars and experts with regard to sustainable and responsible investments for its lack of transparency (Schrader 2006), data availability and reporting (Ferrua Rotaru 2019), diverging definitions (Paetzold, Busch, and Chesney 2015), or inconsistent measurements of ESG ratings (Berg, Kölbel, and Rigobon 2020), and more recently a dilution of regulation of SF products on the European level (Webb 2021).

Facing this wide-ranging and substantiated critique towards SF, the news media take on a crucial role in not only raising more awareness and engagement for SF among the public, but also triggering critical thinking and the questioning of “green” market practices. A commonly accepted role of the news media in well-functioning democracies is to fulfil a “watchdog role” (Norris 2014), thus keeping those in power (e.g., politics, economy) accountable. However, financial journalists have done a poor job in the past in fulfilling their watchdog roles, particularly with regard to the Global Financial Crisis (2007–2009) (Manning 2012; Starkman 2014; Tambini 2010), previous financial crises such as the 1990 recession or the Dot Com boom (Knowles, Philips, and Lidberg 2017), and even in the aftermaths and during the Great Recession (Usher 2012; 2017). Hence, facing a new trend such as SF on the financial market that is both heralded as the solution for financing a climate friendly future but also as a potential market bubble (Quinson 2020), the news media play a key role in uncovering frauds and imbalances within the system.

The Agenda-Setting Function of the News Media and the Financial Press

The news media have been ascribed a powerful part in forming public debates and setting the public agenda for certain topics (McCombs and Shaw 1972), and particularly with regard to climate change (Schäfer 2012). Journalism research has a long tradition in studying the agenda-setting effect that implies that those topics that are put high on the medias' agenda (e.g., reporting more often, placed more prominently) are also high up on the publics' agenda (McCombs and Shaw 1972). Similarly, the second-level agenda-setting theory suggests that even the way the news media present a certain topic (e.g., attributes, frames) can spill over to the salience of attributes the audience uses to interpret or evaluate the respective topic (McCombs 2005). Support for both agenda-setting effects has been found by numerous empirical studies (e.g., Coleman and Banning 2006; López-Escobar, Pablo Llamas, and McCombs 1998), and even in the financial context (Strauß, Vliegenthart, and Verhoeven 2018) and related to climate change (see for an overview: Schäfer 2012).

In this vein, the news media play a paramount role in raising awareness for SF and in influencing interpretations among various audiences such as the financial industry, policy makers, or the broader public. By not only covering the topic on a regular basis but also by critically reflecting upon it and presenting diverse standpoints, (financial) journalists who write about SF could potentially lift the debate about a more sustainable economic and financial system from the elite circles to the public agenda. Yet, the effectiveness of such media portrayals is subject to the way the information is presented, conveyed, received and interpreted in a given socio-economic and cultural framework (cf. Olausson 2011). Financial news, for example, has been found to play a determining role in shaping, influencing and changing the elite opinion with regard to political debates (Arrese 2017; Corcoran and Fahy 2009). By aiming at a small and closed elite circle (e.g., decision-makers in politics and businesses), the financial press is attributed the power to influence and change debates among the elite, raising issues and bringing awareness to topics that might otherwise stay ignored (Arrese 2017).

However, the power of the financial press in influencing political decision making and elite discourses might depend on the specific news outlets. More specifically, financial news can be split in specialized news outlets–hence, news outlets that solely deal with business and financial news (e.g., Financial Times, Handelsblatt)–and mainstream news that typically include a financial/business news section (The Guardian, FAZ, Der Standard). Furthermore, Frig et al. (2018) assert that there is also a difference between business and watchdog press; hence, journalism that merely reports and conveys recent business news and updates and journalism that supervises, controls and monitors the financial and business sector. With regard to SF, several news outlets have developed an expertise on the topic, such as the Moral Money newsletter by the Financial Times or other stand-alone news providers such as the Responsible Investor (Strauß 2021). Hence, keeping these distinctions and new developments in mind, it becomes of interest to investigate: (RQ1) How do (financial) journalists perceive their role in influencing the public discourse of SF?

Financial Journalists, Reflexive Market-Relations and Journalistic Challenges

Following the argumentation above, the main reasoning of this study is that the way (financial) journalism presents SF in the news media will have an impact on how the discourse and public opinion about the topic will develop (cf. Engesser and Brüggemann 2016). However, financial journalism has been criticized in the past for its proximity and dependency on financial and elite sources and its reflexive relationships with the market (Davis 2005; 2006; Starkman 2009; Thompson 2009). Furthermore, Davis (2015) points out that the market largely relies on the consensus opinion, and that investment narratives drive investment trends and fashions whereby the media play a key role. Hence, the news media might also create and reaffirm the narratives surrounding SF, thereby affecting investment decisions related to sustainable and responsible investments. Yet, given that much of the financial discourse about market trends, such as SF, is placed within elite circles, critical and investigative reporting is required in order to challenge narratives that are mainly fed by the financial industry (Davis 2015; for SF: Strauß 2021).

But how can financial journalism challenge SF if journalists themselves are dependent on the very sources and elites that constitute the narratives about SF? Starkman (2009), for example, points out that financial journalists are dependent on frames and discourses that are pushed by Wall Street, leading to a lack of investigative reporting. Similarly, Thompson (2013) speaks of a “reflexive, constitutive dimension of informational processes in financial markets” (208), pointing out the danger of financial journalists in reflecting and reinforcing a market consensus that could lead to financial bubbles. More specifically, Strauß (2017) has identified the interrelationships between financial news sources, financial journalists and financial audiences as a self-referential financial information ecosystem. Hence, the way the news media will understand, evaluate and eventually report about SF might also strongly depend on the sources the journalists rely upon when covering SF. As it follows, the second research question reads: (RQ2) How do journalists understand and evaluate activities in the area of SF and how does it relate to the prevalent market narrative of the “climate change” solution?

The overly reliance on elite sources by journalists and the necessity to keep close relationships with those sources, thus re-enforcing market narratives, might also be due to a lack of resources in financial editorial offices. In line with the journalism industry in general, financial journalists are suffering from financial and resource cutbacks (Manning 2012). Scholars have reported that financial journalists have to work under high time pressure (Tambini 2010), that some journalists switch to freelance journalism, and that occasionally senior personnel are laid off and replaced by young, versatile video reporters (Strauß 2019). Furthermore, high-frequency trading and real-time news cycles are asking from financial journalists to report at a high speed, which also affects their quality of sources and analysis (Tambini 2010; Thompson 2013). In addition, scholars have raised concerns about the level of training and skills among financial and business journalists (Davis 2007; Doyle 2006; see also Schiffrin 2011) and identified an overall decline of journalistic standards in financial journalism (Knowles, Philips, and Lidberg 2017); others have pointed out that the complexity of the financial market and its products pose challenges to financial journalists in their daily reporting (Tambini 2010).

What is more, financial journalists were found to be increasingly dependent on PR sources, enabling financial PR to become an influential agenda-setter for financial news (Tambini 2010). Scholars have identified this relationship between financial PR and financial journalism as a co-dependency: on the one hand, journalists with high time pressure rely upon news stories provided through PR; on the one hand, financial PR depends on the publication of corporate stories in the financial news to promote their side of the story (Tambini 2010; Doyle 2006). Furthermore, financial journalists are dependent on financial market actors for data, expert insights and analysis, but access to this market information is sometimes only granted if also presented in a desired way (Dyck and Zingales 2003). Knowles, Philips, and Lidberg (2017) point in this regard to “ideological, institutional, and commercial pressures (that) have been compromising the practice of financial journalism” (323). Similar challenges (e.g., time pressure, source dependency, elite sources, PR influences, editorial policies) have also been reported with regard to environmental and climate journalism (see for an overview: Schäfer and Painter 2021). Hence, given that the reporting of SF combines aspects of financial and environmental news, the question arises: (RQ3) What challenges do journalists face when reporting about SF?

Method and Data

Interview Procedure

To find answers to the research questions posed in this study, a qualitative and comparative research approach has been chosen (Silverman 2004). 33 semi-structured interviews with journalists from Austria, Belgium, Germany, the Netherlands, Switzerland and the UK were conducted based on an interview guide (see Appendix). Journalists were chosen based on a preliminary research in which 114 journalists were identified who have covered SF, or more generally sustainability and the economy, in 2018 and 2019 in the six countries mentioned above. After reaching out to the journalists via their professional email address, LinkedIn or Twitter profiles (where available) in late October 2019, 33 journalists eventually agreed to participate in the study (overall response rate: 56%; 12 female/21 male). The journalists subject to this study are writing for daily news, financial news outlets, weekly economic magazines, and trade magazines (see Table 1 for an overview and the political leaning of the news outlets). They all differ in terms of their level of expertise, with the majority having between 10–30 years of experience in the field of journalism and only three journalists who have just recently started working in the field.

Table 1. Overview of journalists per country.

Country	Number of Interviewees	News Outlet	Political Leaning	Mainstream vs. Specialized News Outlet
Austria	6	Der Standard Falter Der Börsianer Freelance journalists	center-left left n.a. n.a.	mainstream mainstream specialized n.a.
Belgium	2	De Standard Politico	liberal-conservative center-left	mainstream mainstream/specialized (Brussels politics)
Germany	18	Süddeutsche Zeitung Der Tagesspiegel Frankfurter Allgemeine Zeitung (FAZ) Taz Der Spiegel Handelsblatt Freelance journalists	center-left left center/center-right left center/center-left center n.a.	mainstream mainstream mainstream mainstream mainstream specialized n.a.
Netherlands	1	Volkskrant	center-left	mainstream
Switzerland	2	Neue Zürcher Zeitung (NZZ)	center/center-right	mainstream
United Kingdom	4	Financial Times Responsible Investor Top1000funds.com Bloomberg	center (economic liberalism) n.a. n.a. center-left	specialized specialized specialized specialized
Total	33

Before conducting the telephone interviews in November and December 2019, each journalist had to sign a consent form that was accompanied by an information sheet that covered the procedure of the study, privacy issues and data protection regulations. The interviews were conducted either in German or English. The conversations lasted between 25 and 60 min and were recorded with a voice recorder. Afterwards, the audios were anonymized and sent to transcription services in the UK and Germany.

Case Selection and Interview Sample

The selection of the six countries (AT, BE, CH, DE, NL, UK) was mainly guided by economic, political and cultural reasons. Austria was chosen because SF is rather underrepresented in the country with no active green/ethical retail bank operating in the country (WWF 2019). Six journalists in Austria were part of the sample, ranging from the mainstream newspapers Der Standard and Falter to the specialized news magazine Der Börsianer and a few freelance journalists. Belgium is part of the sample because it represents the country that is closest to the European policy making process with regards to SF (e.g., taxonomy by the EU High-Level Expert Group). Here, two journalists were interviewed: one from the mainstream newspaper De Standard and one from the Brussels-focused news outlet Politico. Germany has been included in the sample because it represents the strongest economy in Europe but has remained fairly inactive and hesitant with regard to SF in the past. The majority of journalists interviewed in this study came from Germany, and mainly worked for mainstream news outlets such as the Süddeutsche Zeitung, Der Tagesspiegel, Frankfurter Allgemeine Zeitung, Taz, Der Spiegel, for the financial newspaper Handelsblatt or as freelancers.

In comparison, the Netherlands work as a role model by having already implemented crucial financial steps to combat climate risks in the country (e.g., engagement of pension funds, development banks, insurances, etc.). Yet, only one Dutch journalist from the mainstream newspaper Volkskrant could be recruited for the interview. Switzerland takes a decisive role in moving SF forward given the concentration of vast capital in the financial center of Zurich. In fact, one of the first international hubs for SF, the Swiss Sustainable Finance (SSF), was founded in Zurich in 2014. In Switzerland, two journalists were interviewed from the mainstream newspaper Neue Zürcher Zeitung. Lastly, the UK was chosen because they have enacted a leading role in advancing both policy and research with regard to SF. For example, the UK has set up the first Green Investment Bank, they were among the first governments that have publicly announced to aim at net-zero carbon emissions by 2050, and with Mike Carney as the former president of the Bank of England, they have a prominent voice that advocates for SF around the world. In line with this leading function, four journalists from the UK were interviewed for this study, all working at specialized financial newspapers, such as the Financial Times, Responsible Investor, Top1000funds.com or Bloomberg.

Given these differences across the six countries in terms of expertise, professionalization and policy regulations regarding SF, distinctions but also similarities among (financial) journalists and their way of covering SF were expected. Yet the particular composition of the sample, in which not only German-speaking journalists from mainstream news outlets are overrepresented but also where the UK is exclusively represented by journalists working for specialized financial newspapers, limits the generalizability of the findings.

Interview Analysis

The interviews were analyzed by the author of this article according to common themes that emerged from the data (Silverman 2004). First, the interviews were read with an open mindset. Second, codes were assigned to each statement that provided answers to the questions from the interview guideline. Third, all codes were transferred into an excel-sheet that gave an overview of all codes for each journalist and for each question. Based on this overview, codes were categorized and merged to overall themes (e.g., sources, role perceptions, role of climate change). The codes under these emerging themes were then analyzed for similarities and differences, also taking into consideration contrasts between countries, media outlets and journalistic experience. This overview allowed to abstract from the collection of codes and to synthesize the information into overarching themes that gave answers to the three research questions posed in this study. The over-arching themes with their main sub-codes were: importance of SF coverage (for public discourse and change); audience differences (mainstream vs. elite), agenda-setting function for SF (media vs. financial market vs. politics); definition of SF; issues with SF (e.g., regulation, greenwashing, hypocrisy), and challenges of SF reporting (e.g., niche topic, complexity, limited resources, announcement stage).

Results

Influencing Public Discourse: Mainstream vs. Elite Audience

When asked about the public discourse of SF and their role as a journalist in forming the debate, a repeated answer was that although SF has entered mainstream in the financial markets, it still remains difficult to reach a broader audience. Andrew Edgecliffe-Johnson, US Business Editor at the Financial Times, stated that SF “can be quite an elite debate.” While journalists from the mainstream news outlets such as Süddeutsche Zeitung, FAZ or NZZ indicated to write for the broader public, they also stated that the network of readers of articles about SF is constituted of a dedicated community that is highly active and interested in the topic. As reported by a financial journalist from the mainstream newspaper NZZ, “Most of the feedback I receive on articles about sustainable finance are from the community, the big family of sustainable investments such as asset managers or consultancy firms.”

Facing limited reach with articles about SF, journalists from mainstream news but also from specialized news outlets such as Handelsblatt stated that their power in bringing about change among their readers is constrained. Instead, their aim is to raise awareness for SF and to incentivize readers to become more critical about the topic and to reflect upon their own role in the financial system. As a Dutch junior journalist from the Volkskrant indicated, “I like to do journalism by using current events to show people they are part of the workings of a bigger system.” Most of the journalists, both from mainstream and specialized financial news, saw their main role in conveying and reflecting information about the financial markets, educating their readers about recent market trends, and providing information based on which their readers can act upon. Despite these journalistic motivations to raise awareness and engagement among the broader public, all journalists rejected the idea of an active advocate or missionary who calls the reader to take direct action. Markus Frühauf, a long-term financial journalist from the mainstream news outlet FAZ in Germany pointed out, “I don't have the mission to urge the world to invest in sustainable investments. But my job is to observe the developments and neutrally report about it.”

In addition to the neutral information conveyer role, journalists from specialized financial newspapers and trade magazines such as the Financial Times appeared to ascribe themselves a more active, co-shaping role by engaging their elite readership (politicians, CEOs, decision-makers) with the topic of SF and having an influence on opinion-makers in politics and the industry. This empowerment among journalists seems to be, furthermore, dependent on the constitution of the audience of the respective news outlet. As Andrew Edgecliffe-Johnson from the Financial Times explained

The FT is unusual in that the people who read the FT are often the people we’re writing about. They are very senior people. They are decision-makers … it also means that we have an incentive to encourage our audience to send us thoughts, send us feedback, and send us ideas for further reporting.

Journalists from these specialized news outlets seem to be more optimistic in forming the public debate given that they are in direct contact with decision-makers who provide the journalists with information, comments or information on SF. By calling out greenwashing, providing various perspectives on the topic and raising critical questions among key players, these journalists hope to influence decision-making processes among key players. As Susanne Bergius, a renowned financial journalist who regularly reports about SF at Handelsblatt, says, “My goal is very clear: To contribute to information, discussions, and decision-making, especially among decision-makers.”

Across mainstream and specialized news outlets, journalists acknowledged the fact that the media work as agenda-setter in some cases and that they have the power to move topics such as SF on top of the agenda, thereby making people more aware. Bernhard Pötter, an experienced journalist who writes for the leftist newspaper taz in Germany, shared his view, “Of course, we have the obligation and the job to keep the debate about such topics (SF) alive and to ensure that reasonable solutions are discussed.” At the same time, it became clear that the media are not necessarily setting the agenda themselves. Rather, the agenda of the media is built by the financial industry and politics who do not only present the major sources for journalists in covering SF, but they also initiate events and occasions where journalists feel the need to report about. Ingo Arzt from Tagesspiegel elaborated “At the moment, the agenda is very much driven by the political sector. There are specific meetings, such as those regarding reforms on the EU-level (regarding SF).”

Sustainable Finance: Solution for Climate Change vs. Greenwashing

When asked how they would define SF, journalists varied considerably in their answers. Journalists used various points of references to define SF, ranging from certain investment strategies (exclusion vs. inclusion of certain companies) to the compliance with ESG criteria and the SDGs, or a general focus on safeguarding the environment, ecology and biodiversity. Some journalists had an even broader definition of SF, as one UK female journalist from a specialized trade magazine explained, “The way we cover it (SF) … are these environmental, social and governance issues with an overlay of broader and more philosophical questions around long-termism, morality … We see it as responsible capitalism, really.” Anna Hirtenstein who used to cover SF at Bloomberg spoke of sustainability in terms of “stability,” preventing the financial system from collapsing. In general, however, most journalists pointed out that the unclear definition of SF and the arbitrary use in countries (e.g., exclusion of nuclear energy as SF in Germany vs. France) and by industry actors is one of the core problems that inhibits a wide-ranging implementation and success of SF. In this vein, journalists from both mainstream and specialized news outlets had a rather critical view on the extent to which SF can be an answer to fight climate change.

Instead, the common perception was that although SF presents a powerful leverage to transition the economy towards a greener future, there is no single solution for climate change. However, SF does represent a building block, according to the journalists, to move capital into sustainable projects or putting financial pressure on companies to accelerate the transition towards more sustainable business models (e.g., through divestment threats). As a young female financial journalist writing for a mainstream newspaper in Germany explained,

There is no single solution. It needs to go hand in hand, also in combination with political measures and individual consumer behaviour. But money, of course, represents a massive incentive for enterprises. That way sustainable finance works as a strong leverage, but it's not the only factor.

However, in line with the criticism expressed by experts and scholars with regard to SF (e.g., greenwashing, measurement, lack of transparency and accountability), all journalists but one from a specialized news outlet in the UK pointed to a number of issues related to SF. For example, one of the major concerns is that most of the announcements in the financial sector about integrating ESG (environmental, social, governance) factors and reducing carbon emissions are merely self-commitments, and not legally binding. Another problem that journalists saw is that the major focus is on the “E” (environment) of the ESG factors, whereas social aspects and biodiversity are oftentimes neglected. Furthermore, the measurement of sustainable investments and their impact still represents a major challenge for the market, and journalists also indicated that there is equally a lack of “eligible” sustainable investments, if sustainability would be measured more strictly. As one journalist from a mainstream German newspaper recalled from talks with investment companies, “Those that have very strict exclusion criteria, for example, say that the universe of available investments shrinks rapidly.”

Some journalists from mainstream German and Swiss news outlets, furthermore, criticized that all financial institutions, and particularly asset managers, are still part of a capitalistic system, following the growth principles in securing a high return for their clients' investments when talking about SF. Similar to the commentary by the former BlackRock investment expert (Fancy 2021), one Swiss journalist pointed out that most of the “sustainable investment indices” are very similar to conventional indices with slight over- or under-weighting of some stocks. In relation to this, Susanne Bergius, an experienced freelance journalist covering SF for many years in a specialized newsletter for Handelsblatt in Germany, stated that although the movement of SF has matured in the past years, she still comes across “many prejudices” of SF (cf. comes at the cost of lower returns) despite mounting academic evidence that have proven the opposite. Similarly, one journalist from a mainstream news outlet emphasized that there is a considerable lack of knowledge with regard to SF among financial market actors, and that financial advisors, that are in direct exchange with their clients, are often not knowledgeable about SF and how it translates into personal financial advice.

Some journalists from the German speaking news outlets but also journalists from specialized news outlets who have observed the developments attentively, had a particular critical view towards SF. In fact, they considered the whole movement a “hypocrisy” or “marketing stunt.” A German-speaking journalist from a mainstream newspaper is concerned that SF entices people to live with a good conscience, true to the motto, “Now that I have invested in a sustainable fund, I can go on a cruise.” Another journalist from a specialized trade magazine worried,

All of the morality is kind of been cut away from the conversation. It's almost

unfashionable to be expected to have any morals. When we talk about ESG, people are very quick now to hedge it with, “We're no tree huggers.” It has nothing to do with your values, which is a little bit alarming, but that's how this (SF) has become mainstream.

Hence, by investing “green” or “sustainably” some individuals are accused of keeping their hands clean while at the same time failing to transfer their financial pledges into a truly sustainable lifestyle. According to a journalist from a specialist news outlet, an overall moral and ethical discussion about the principles and mechanisms how the financial markets are currently working is missing. Among the more critical journalists, there is a demand for a cultural change among financial market participants, and the need for a more fundamental discussion about how the economic system should operate. Marcel Grzanna, who has covered SF for the German mainstream newspaper Süddeutsche Zeitung, said, “I firmly believe that sustainability can only work if there is a cultural change … we have to integrate sustainability as a guiding principle.”

Regulating Sustainable Finance: Politics vs. Market

Another topic that has often been discussed with regard to the potentials of SF to fight climate change and its issues was the role of politics. Here, the journalists could be split in two camps. While on the one hand, journalists from more conservative newspapers or financial trade magazines (FAZ, top1000funds.com, Handelsblatt) took the view that politics should only provide a framework for SF (e.g., trustworthy labels) but should not restrict free market principles, journalists from more liberal or leftist mainstream newspapers saw an urgent need for politics to take more immediate and radical action and to provide (global) regulations that promote a transition towards a more sustainable economic future. Markus Frühauf from the FAZ, for example, stated with regard to the EU taxonomy for SF by the EU Commission, “I put more hopes in market movements than in the negotiations currently taking place in Brussels.” In direct opposition stand two quotes by Bernd Pötter (taz, Germany) and another journalist from a mainstream newspaper in Germany, who identified the record-breaking IPO of the oil company Saudi Aramco in December 2019—in midst of the SF and taxonomy discussions—as a clear market failure. Another example, mentioned by a German journalist writing for a mainstream news outlet, is the colossal amount of credit financing for “unsustainable” companies that has so far been mostly exempt from the discussion about SF. The inability of the market to regulate itself is also reflected in public demands by financial market actors in which they call for more political regulation regarding SF. A young journalist from a mainstream newspaper in Germany, for example, stated, “More and more providers and companies, and the financial industry in general, are demanding more regulation in this area (SF)—which is very unusual for the financial industry.”

While the EU and its engagement in setting up regulations and a taxonomy has generally been applauded by the journalists, national governments were viewed more critically with regards to their activities in the area of SF. Germany has unanimously been identified by its journalists to lag too much behind in terms of SF compared to other countries such as the UK, France or Scandinavian countries. Jakob Blume, a financial journalist from Handelsblatt, observed, “Well, the government in Germany has rather been driven by external pressures from investors to become active in the area of sustainable finance (e.g., green government bonds).” Similarly, the Austrian government has been criticized by its financial journalists for not sufficiently caring about sustainability issues although politicians and parties are using the topic (including SF) in an opportunistic manner and in order to appeal to a broader trend among the electorate.

In fact, the issue of strong lobbyism by the financial industry that is still inhibiting more drastic political crackdown on the national and European level to bring about lasting sustainable change, has been lamented by two German journalists who have long experience in covering SF and another journalist close to the political discussions about SF in Brussels. For example, a freelance (TV) journalist who is also member of the European NGO Finance Watch pointed out, “It's very problematic that economic representatives are very strong in lobbying politics … a finance lobby that is all-powerful.” Looking into the future, there was also an overall agreement among the journalists from mainstream and specialized news outlets that stricter regulations are likely to be introduced (e.g., taxonomy, sustainability reporting, carbon tax). As Marcel Grzanna, freelance journalist and writing for the Süddeutsche Zeitung, sketched, “If we do not act more sustainable today, the consequences will be political … there will be clear rules and restrictions.”

Challenges in Reporting About Sustainable Finance

Among the majority of journalists, reporting about SF was generally understood to be a difficult undertaking. The biggest challenge, as reported by mainstream journalists, was to reach a broader audience that goes beyond the small community that is interested in SF. Journalists from both mainstream and specialized news outlets reported that the topic of SF is rather cumbersome to write about: it is perceived as complex, dry and lacking interesting angles that would captivate the audience. One of the journalists pointed out that the topic of SF itself is generally associated with a positive underlying tone and that the absence of controversy and disagreements among parties in relation to SF would make it hard to add a twist to the story. In addition, many news stories about SF initiatives are still in the announcement stage that only allow limited critical assessment on the side of the media, according to a German journalist writing for a mainstream news outlet. Another journalist from the same outlet in Germany complained about the limited space in daily newspapers to explain a multi-layered topic such as SF, “Economic magazines, of course, have ten pages to write about green investments, for example— space that I don't have in a daily newspaper.”

Overall, the coverage about SF has intensified strongly in the past years (since 2018), and some financial news outlets even created dedicated newsletters about SF (e.g., Moral Money by the Financial Times, Sustainable Finance Briefing by Handelsblatt). In line with this, no journalist said that it would be difficult to publish stories about SF in the respective news outlet. However, at the same time, it was highlighted that SF is not necessarily a topic that makes it easily to the front page. Ingo Arzt from taz summarized the situation in Germany, “The FAZ reports regularly, Handelsblatt placed the topic prominently in their newspaper … a lot is happening in the German media landscape. But it remains a difficult topic that is bulky and difficult to be told.”

However, at the same time, journalists from German specialized news outlets and freelancers criticized the mainstream reporting for being too superficial, not critical enough, and for presenting similar stories over and over again (e.g., explanation of what SF means). As Susanne Bergius, an expert on SF reporting indicated, “In my opinion, there is not enough coverage about SF (in Germany), let alone detailed enough reporting. I am missing more consistency in the reporting of this topic.” Overall, both journalists from mainstream and specialized outlets said that there is a lack of coverage dealing with larger developments on the market, articles that go more in detail, provide more context and take a more critical lens towards the trend of SF. As Felix Holtermann, a financial journalist from Handelsblatt explained, “I wished there would be more coverage about the fundamental questions that underline the topic.” More specifically, one freelance journalist in Austria and one in Germany respectively said that there needs to be more reporting on SF in the local news and on TV in order to reach a broader audience. While this criticism was particularly expressed with regards to the coverage in the German media landscape, English-speaking financial newspapers like the Financial Times, Bloomberg, or The Economist were attested to do a better job in offering more in-depth analyses, thanks to their resources and expertise.

With the exception of one journalist, all journalists indicated that they want to pursue SF further in their work as a journalist. Not only did they assure that they want to write more, more intensively, and more broadly about SF in the future, they also said that they want to take a more critical stance by checking whether the assumptions made in the past months and years will truly be met by the industry in the upcoming years. As a journalist from a mainstream German newspaper put it plainly, “There comes a point in time where one has to check whether the things have actually taken place, what needs to be done differently and whether the expectations have been met.” Most of the journalists assessed the future of SF more positively, projecting that SF will become more professionalized, more mainstream but, at the same time, will also face more regulation and more pressure from society. In the meantime, all journalists considered it as their duty to report on a market trend such as SF and make the public aware of how the financial market can work as a means to finance the transition towards a more sustainable future.

Discussion

The financial sector is currently widely promoting “Sustainable Finance” (SF) and presents these financial activities (e.g., funds, bonds, impact investment) as a solution to finance the transition into a low-carbon economy. At the same time, critical voices are increasingly being raised regarding the credibility, reliability and trustworthiness of SF activities (Dupre and Roa 2019; Fancy 2021; Paetzold, Busch, and Chesney 2015). Facing this far-reaching market trend on the one hand, and citizens that remain fairly uninformed about the potentials and pitfalls of SF on the other hand, this study set out to research the role of the news media in bringing about more awareness for SF. Following the agenda-setting theory (McCombs and Shaw 1972) and the dependency and reflexive relationship between financial journalists and the financial market (Davis 2005; 2006; Thompson 2013), 33 journalists in Europe (AU, BEL, CH, GER, NL, UK) that have covered SF in mainstream and specialized news outlets in the past years were interviewed about their role in the public discourse about SF, their understanding and evaluation of SF vis-à-vis climate change, and the challenges they face when reporting about SF.

The qualitative interview analyses have revealed that mainstream journalists ascribe themselves a limited role in influencing the public debate, let alone bringing about a broader change among their audience. While most of the journalists saw their role confirmed in—at least—raising awareness and putting the topic on the public agenda (agenda-setting effect) by reporting about the trend neutrally, some of the journalists revealed that the agenda of reporting about SF is predominantly set by events happening in the political and economic sector. After all, all journalists rejected the idea of being an advocate or missionary for SF, trying to influence the behaviour of their readers. The fact that journalists presented themselves as neutral information transmitters and refused the role as an advocate or mobilizer has been found in previous research on climate journalism (Gibson et al. 2016; Gunster 2017), but also with regard to financial journalism (Strauß 2019).

However, journalists from financial news or specialized news outlets presented themselves as mediators who are in direct contact with the powerful elite, thus feeling more empowered to stir decision-making processes of key actors in the field. Both the influence of the financial press on elite decision-making process (Arrese 2017; Corcoran and Fahy 2009) as well as the closed circle of (financial) journalists, information sources and audiences find support in previous studies (e.g., Davis 2005; 2006; Thompson 2013). Yet, given the mounting criticism regarding “greenwashing” and SF in the financial sector, this self-referential financial information ecosystem (Strauß, 2018) is a cause for concern. Rather than relying on sources from the financial system, journalists should open up the discussion about SF to the broader public, including NGOs, politicians, citizens as well as communities and businesses in need of “sustainable” financial means, thereby presenting SF from a more diverse, critical and contrasting viewpoint. What is more, instead of only fulfilling the role of an “information-transmitter” regarding SF, journalists could employ a more participatory or motivating style of writing in engaging their audience to take action, but without compromising their level of professionalization (cf. active watchdog role: Usher 2017).

What is particularly worrisome it that the journalists in the interviews seemed to keep their neutral and distant attitude when reporting about SF despite the vast criticism they have raised towards SF. Not only did the definitions and understandings of SF vary considerably among journalists, the interviewees also perceived the “fuzziness” of the term as one of the core problems of SF. Some journalists openly criticized the whole trend of SF as a marketing stunt or an act of hypocrisy, and saw the industry still entrenched in a capitalistic, growth and return-oriented system. While the majority of journalists admitted that SF presents a leverage to fight climate change, some journalists also pointed out that a broader economic “cultural change” and strong political interventions are needed to offer solutions to the looming climate crisis. While these points of criticism are in line with some issues that have been raised by experts in the past regarding SF (Ferrua Rotaru 2019; Paetzold, Busch, and Chesney 2015; Schrader 2006), journalists seemed to remain in their neutral information transmitter role; thus, running the risk of becoming the devil's advocate and merely presenting a platform for financial PR on SF.

One reason for this absence of an active watchdog role might be related to the challenges that journalists face when reporting about SF. In general, journalists from mainstream news outlets perceived the topic as too complex, bulky and dry to report about and also moaned about the limited reach that some of these articles attain. Despite these obstacles, almost all journalists committed themselves to pursue the topic further, and promised to keep up with the announcements currently being made by the financial industry related to SF. However, in order to fulfil this watchdog role (Norris 2014; Usher 2017) in the future, more resources for investigative and independent financial reporting are needed. Particularly with regard to the continuously declining revenue streams for news media outlets (Gabbatt 2020) as well as cutbacks reported in financial editorial offices (Manning 2012), the question remains to what extent journalists are given the means and tools in the future to hold the financial sector for its claims about SF accountable.

While follow-up research should further observe the developments of SF from a journalistic point of view, some of the limitations of this study should be taken into consideration. First, the interviews with the journalists were conducted in late 2019. Given that SF is an emerging field and many developments are currently gaining traction (e.g., the “social” factor of ESG has gained more importance as a result of Covid-19), scholars need to be aware of the ephemerality of some of the findings presented here. Furthermore, the sample of this interview study suffered from an overrepresentation of German journalists. However, given that German news media are also read in Austria and Switzerland, the differences are somewhat negligible. Finally, the approach taken in this study to interview journalists to research the agenda-setting function can be considered restrictive. Future studies are thus invited to take an audience-centred approach by interviewing, surveying or observing citizens and how they integrate information about SF in their individual financial decision-making processes.

To conclude, this study has offered an innovative perspective in researching the role of the news media in bringing about more awareness and critical engagement with SF. Although the findings sketch a pessimistic picture regarding the power of the news media in influencing the broader public—aside from the agenda-setting effect—the financial press with its specialized news reporting in particular appeared to be a powerful tool in mediating decision-making processes among the powerful elite. However, despite journalists' overall vast criticism towards SF (“greenwashing”), the majority of journalists seemed to remain in an information transmitter and conveyer role. Looking ahead, it is hoped that journalists will overcome the challenges related to reporting about SF (e.g., complexity, missing conflicts, announcement phase, lack of resources) and more vigorously execute their watchdog role function in the future.

Acknowledgements

This project has received funding from the European Union's Horizon 2020 research and innovation programme under the Marie Skłodowska-Curie grant agreement No 834638.

The author would also like to thank all journalists who have participated in this research.

Disclosure Statement

No potential conflict of interest was reported by the author(s).

Additional information

Funding

This work was supported by H2020 Marie Sklodowska-Curie Actions: [Grant Number 834638].

Appendix: Interview Guide

(A) Coverage about SF

1. In what way have you been reporting about SF in the past (article, op-eds, hosting of events, conferences, etc.)?

2. When have you started reporting about SF?

3. Since when has the topic of SF gained more relevance in the financial industry/market? And for your reporting?

(B) Opinion about SF

1. What does SF mean to you?

2. To what extent do you believe SF can be a solution for climate change?

3. What role would you ascribe politics in the discussion about SF?

(C) Learning about SF

1. How did you learn/find out about SF?

2. How does the journalistic process look like when writing about SF (ideas, sources, etc.)?

3. How do you decide which sources to trust?

4. What role does sponsorship play for the coverage of SF?

5. How do you deal with greenwashing/green claims?

6. Who else contributes to the discussion about SF in the news, based on your experience? (specifically tailored to the respective country: Germany, Austria, Belgium, Switzerland, UK, Netherlands)

(D) Perception of the Discussion

1. How do you perceive the discussion about SF in the news (too much/less, critical enough)?

2. How does your editor/editorial office react to stories about SF?

3. How do your audiences/readers react to stories about SF? What feedback do you receive?

(E) Role Perceptions

1. How do you perceive your role as a journalist in the discussion about SF?

2. Why do you think the coverage about SF is important?

3. What are you missing in the discussion about SF?

(F) Future of SF

1. How do you think the discussion about SF in the industry/public will develop in the near future?

2. Where do you see your role in forming the discussion about SF in the future?

   Is there anything that you would like to add …