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The writer is founding director of the Oxford Sustainable Finance Group and Lombard Odier Associate Professor of Sustainable Finance at the University of Oxford
Academic research is essential for the proper functioning of financial markets. It’s where some of the most important financial practices originate; researchers also play a crucial role in accountability within those markets.
The contribution of academic research is particularly important in sustainable finance — an area that is under-developed, rapidly growing and inherently multidisciplinary.
In the course of being, among other things, co-chair of a global alliance of universities working to advance sustainable finance and ESG research, I have benefited from productive research partnerships with some of the world’s best financial institutions.
Unfortunately, I have also heard too many stories, often from early career researchers at a range of institutions, of instances where financial institutions and ESG data providers have sought to undermine academic freedom. They have done this by trying to change the results of research before publication, or have attempted to prevent it from being published at all, to protect their products and services.
Harassment and intimidation, including threats of legal action and of funding being withdrawn, have been used to bully universities and individual researchers. The organisers of academic conferences have also been pressured to remove peer-reviewed papers from schedules.
ESG data providers often give free or discounted licences to researchers to encourage the use of their data. But under the terms of some licensing agreements, data providers can insist on reviewing research before publication or even withhold permission to publish. This has a chilling effect on the questions and results that researchers focus on.
There are many more financial institutions and data providers collaborating productively in the spirit of free inquiry with academics than those trying to inhibit academic freedom. But if this conduct becomes more widespread, it will harm research quality and deter researchers from working on ESG.
We can fix this if we take action now. That starts with regulatory supervisors taking these breaches seriously, to minimise their impact on markets and to hamper greenwashing. The US Securities and Exchange Commission and the UK Financial Conduct Authority, among others, should namecheck these practices of harassment and intimidation in their whistleblowing criteria and encourage researchers to come forward, safe in the knowledge that they are protected.
Many of the examples I am aware of arise from market practitioners simply not understanding how to work with academics. We need enforceable codes of practice for how they can support academic research. ESG data providers should also end the practice of vetoing and/or reviewing pre-published research that uses their data.
Universities need to be better at defending academic freedom too, starting with training and support for early career researchers. Attention should be given to ensuring institutions aren’t captured by funders at the expense of research integrity. This should be a greater focus for the higher education regulators, such as the Office for Students in England and their new director for freedom of speech and academic freedom.
And finally, senior researchers must call these things out. We need an open conversation about the extent of the problem, its causes and the potential solutions. Over time, this transparency will result in better-quality partnerships.
This conversation isn’t currently happening. Yes, having it would involve addressing the intimidation of individuals, sensitive donor relationships for universities, industry partnerships and complex research processes. But we must protect free inquiry.
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