Socially responsible investing (SRI) funds depart from mainstream finance by incorporating environmental, social, and governance considerations, but their success varies across regions. By using a historical comparative case design, we identify an empirically puzzling phenomenon in China: despite an initially favorable resource environment and the presence of socially skilled institutional entrepreneurs, SRI wanes over time in Hong Kong but survives in Mainland China where initial resource endowments and actors’ social skills were inferior. By comparing four periods of SRI development, we reveal how state sustainable development policies, a change in the institutional context, led unintentionally to a shared orientation and a public pool of resources, which sustained the SRI niche. Our paper contributes to research on market emergence, institutional change, and cultural entrepreneurship.
The research leading to these results has received funding from the European Research Council under the European Union’s Seventh Framework Programme (FP/2007–2013)/ERC Grant Agreement ERC-2010-StG 263604-SRITECH.
Yan, S. and Ferraro, F. (2016), "State Mediation in Market Emergence: Socially Responsible Investing in China", How Institutions Matter! (Research in the Sociology of Organizations, Vol. 48B), Emerald Group Publishing Limited, Bingley, pp. 173-206. https://doi.org/10.1108/S0733-558X201600048B005
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