AC200: Sustainability Reporting in Capital Markets

Explore how sustainability reporting dives progress toward global sustainability goals and transforms decision-making in capital markets.

Over the past decade, regulators, investors, and other stakeholders have increasingly demanded more information about firms’ environmental, social and governance (ESG) performance. This shift has fuelled the exponential growth of sustainable investing in global capital markets and led to mandatory ESG disclosures by publicly listed firms.

In this course, you will examine the benefits of ESG reporting while tackling its challenges, such as mitigating risks like greenwashing. You will examine existing and emerging ESG regulations, frameworks for performance metrics, and their implications for market participants. Using academic research, industry reports, regulatory filings, case studies, and media insights, you will uncover how capital providers – such as pension funds, private equity firms, and banks – as well as suppliers and customers, incorporate ESG data into their strategies to drive meaningful change.

By the end of the course, you will have a comprehensive understanding of the foundations of corporate ESG activities, the evolution and current development of worldwide ESG regulation and reporting requirements, the pros and cons of ESG disclosure, and the adoption of ESG information by different market participants.

Prerequisites: A university-level course with some content in economics, environment, accounting, finance, management, social entrepreneurship, or other business-related subjects

Level: 200 level. Read more information on levels in our FAQs

Fees: Please see Fees and payments

Lectures: 36 hours

Classes: 18 hours

Assessment: A mid-session examination (50%) and a final examination (50%)

Typical credit: 3-4 credits (US) 7.5 ECTS points (EU)

Please note: Assessment is optional but may be required for credit by your home institution. Your home institution will be able to advise how you can meet their credit requirements. For more information on exams and credit, read Teaching and assessment

This course is suited to intellectually curious individuals interested in foundational and practical aspects of organisational sustainability, its reporting and its relationship with the capital and product markets. The course will give you key insights relevant to careers in policy-making, asset managers and financial advisors with sustainable investing, banks with sustainable lending, ESG rating agencies, or the provision of ESG assurance services, such as auditing firms. 

Upon successful completion of this course, you will be able to:

• Understand the core concepts of sustainability for corporations
• Evaluate how sustainability regulation and reporting requirements apply to different organizations
• Identify the economic drivers for ESG information from regulators, capital providers, suppliers, and customers
• Critically assess the quality and usefulness of ESG information, including ratings, greenhouse gas emissions, employee diversity metrics, and compliance with labour and environmental laws
• Evaluate the externalities of sustainability reporting, balancing positive social impact with the risks of greenwashing
• Recommend solutions to improve the effectiveness of corporate sustainability reporting, such as standardizing practices, mandating disclosures, and leveraging third-party verification

The design of this course is guided by LSE faculty, as well as industry experts, who will share their experience and in-depth knowledge with you throughout the course.