Dual-Motive Complexity of Sustainable Investments
Exploring Individual Investors' Decision-Making Process
Time: Thu 2025-11-20 14.00
Location: Kollegiesalen, Brinellvägen 8, Stockholm
Video link: https://kth-se.zoom.us/webinar/register/WN_DoV6uc0uQCSrqz3zRgsBGQ
Language: English
Subject area: Business Studies
Doctoral student: Ida Ayu Agung Faradynawati , Fastighetsföretagande och finansiella system
Opponent: Docent Jonas Nilsson, Gothenburg University
Supervisor: Docent Inga-Lill Söderberg, Fastighetsföretagande och finansiella system; Professor Misse Wester, Lund University
QC 20251027
Abstract
Retail investors play an important role in channeling capital toward achieving the Sustainable Development Goals. Although many retail investors express strong preferences for sustainable investments, not all translate their interest into actual investment behavior, partly due to the perception that sustainable investment products are complex. Sustainable investments introduce an additional layer of complexity by integrating sustainability considerations alongside the traditional financial motive of profit and return. This dual-motive complexity may result in cognitive overload and increased uncertainty for individual investors when assessing investment choices. The general aim of the thesis is to investigate how the dual motives of sustainable investments influence individual investors' decision-making process. This aim is translated into three research questions and four research papers. An online survey was conducted to collect data from 504 investors who are engaged in sustainable investment in Sweden. The survey data were employed to do regression and descriptive analysis for the first three studies. The fourth study employed an experimental study with master’s students as the sample.
The thesis investigates both subjective and objective knowledge in the domains of finance, sustainability, and sustainable finance, and analyzes their relationships with advice-seeking behavior and the understanding of sustainable mutual fund information. Furthermore, it examines how exposure to positive and negative financial and sustainability news influences sustainable investment decisions. The main theoretical contribution of the thesis is the development of a framework to capture the dual motive complexity of sustainable investments. The thesis also proposes managerial implications for financial institutions, financial advisors, and regulators to promote the growth of sustainable investments. Several limitations are acknowledged, which provide opportunities for future research to enhance knowledge of how individuals integrate financial and sustainability motives in their investment behavior.