Keywords: foreign direct investment, sustainable FDI, sustainable investment, sustainability, corporate social responsibility, CSR, investment projects, environmental economics, pulp and paper industry, Latin America, sustainable development, industrial ecology
The Janus face of sustainable foreign direct investments
In this paper, we take a critical perspective on the phenomenon known as Sustainable Foreign Direct Investments (SFDIs). With the pulp and paper sector in Latin America as an illustrative example, we examine how the behaviour of firms is constrained by societal norms and how the greenness and sense of responsibility is constructed within SFDIs. Because of the lack of generally approved metrics for defining SFDIs and the ambiguity of the concept of sustainability, we argue that there are seldom rational arguments for far-going optimism, as far as SFDIs are concerned. We find that greenness and responsibility manifest themselves to no greater extent in SFDIs than in other business contexts. We suggest that the most important and urgent task is to increase the transparency of Foreign Direct Investments (FDIs) and to continue to develop international standards and to metrics that could be used to reliably determine the sustainability of these investments.