Elites and knowledge contestations

Using elites as an analytical vantage point to explore green finance’s knowledge politics invites us to consider knowledge in two forms. First and foremost, knowledge about green finance manifests in interpretations of existing states and ideas about ideal states of finance-nature relations. For instance, disclosure standardisation might be heralded as a solution to an existing market failure where financial actors are insufficiently informed to value nature (and the impact economic activities are imposing on nature) fairly and accurately. More generally, during elite interactions, knowledge might manifest in habitus and routines. Claims to epistemic authority might be tied to tradition, cultural capital, and symbolic credentials (Bourdieu and Passeron, Reference Bourdieu and Passeron1990). While the former form of knowledge more closely corresponds with the concept of knowledge as forum for politics where ideas about finance-nature relations might become contested, the latter resembles the concept of knowledge as means of politics, where (tacit) knowledge regarding, for example, rules of appropriateness is deployed to further specific interests.

Focusing on elites, however, does not only draw attention to these different manifestations of knowledge, it also importantly highlights the significance of this particular actor group in sculpting the politics of green finance. Transversing the spheres of the state and the market, elites are in a unique position to translate knowledge, since they are – by definition – highly connected. As Tsingou (Reference Tsingou2015) has shown, financial governance in particular is characterised by transnationally active networks of such individuals impressing their ideas of appropriate policies onto the global financial market architecture. In the context of the finance-climate nexus, the enrolment of central banks into endeavours of bringing climate-related concerns into financial markets supervision in the form of climate risk has been shown to be heavily facilitated by connections between bureaucratic, private sector, and other state elites (Quorning, Reference Quorning2023; Siderius, Reference Siderius2022; Taeger, Reference Taeger2022). Thus, the exclusivity and privilege characterising such modes of translation shape green finance’s knowledge contestations – or rather their absence thereof.

This elite-based form of governing the finance-climate nexus is not limited to the West. In East Asian economies – often perceived as ‘lagging behind’ in sustainable finance uptake (Stampe and McCorran, Reference Stampe and McCarron2015: 11) – individuals linked to international finance and/or sustainability networks who are also embedded within national policy-making circles play a crucial role in promoting sustainable finance.

In Singapore, ‘sustainability champions’ from core state-building institutions such as the Stock Exchange, government-linked banks, and government-linked corporations spearheaded voluntary sustainability reporting in the early 2010s. Their efforts led to Singapore being the first bourse in the region to adopt mandatory reporting, by enhancing visibility of reporting and securing buy-in from key regulators, such as the Monetary Authority of Singapore. Guided by sensitivities as to what is considered ‘international best practices’, Singapore adopted a principle-based reporting approach, requiring firms to disclose ‘material’ sustainability issues rather than following prescriptive criteria. While elite leadership aligns Singapore’s practice with international norms (Liu, Demeritt, and Tang, Reference Liu, Demeritt and Tang2019), it contrasts with the more rule-based approach to financial regulation traditionally adopted in Singapore, representing an isomorphic mimicry of Western ‘nudge’ strategies rather than an adaptation of sustainability practices to Asian market realities (Liu et al., Reference Liu, Demeritt and Tang2019). In turn, this can undermine the effectiveness of reporting in driving meaningful corporate transformation, particularly in this context where environmental authoritarianism prevails (Han, Reference Han2017)

It is worth noting that, despite this ‘elite capture’ of implementing sustainability concepts and regulations, the principles of transparency, accountability, and scrutiny that underpin sustainability reporting contrast with Singapore’s traditionally closed-door, elite-driven governance system (Barr, Reference Barr2014). The introduction of sustainable finance practices by these elites may have broader implications for the long-term stability of Singapore’s governance model.

Devices and knowledge contestations

Much like the vantage point of elites, approaching green finance through the lens of devices implies encountering its knowledge contestations locally (Latour, Reference Latour2005; Venturini, Reference Venturini2010). Unlike the elite perspective, however, the lens of devices shifts attention from exclusively social to sociomaterial networks, highlighting the non-human entities co-constituting relations within them. This sociomaterial perspective emphasises the materialisation of knowledge within the form of documents or devices, and foregrounds how knowledge claims acquire authority by attaching themselves to existing interests or sociomaterial configurations (Callon, Millo, and Muniesa, Reference Callon, Millo and Muniesa2008; Latour, Woolgar, and Salk, Reference Latour, Woolgar and Salk1986).

Especially once foundational contestations – such as those between a rules- and a principles-based reporting regime mentioned above – have been settled, knowledge relies to a lesser extent on humans to travel or to become effective. Instead, it increasingly starts to materialise in the form of devices, such as metrics, taxonomies, models, or mathematical equations, which are deployed locally in organisational routines. Unlike humans, such devices can be in multiple localities at once, thereby extending the reach of the calculative agency that works through them (Callon et al., Reference Callon, Millo and Muniesa2008; Latour, Reference Latour1987). Following the distinction set out in the introduction of this Forum contribution, devices participate in politics in two ways: as a forum for politics (e.g., when the categorisation of nuclear energy as sustainable in the EU taxonomy became contested) and as a means of politics, or – more precisely – as active components partaking in the furthering of interests, such as when financial service providers or NGOs struggle for authority over the assessment of the so-called climate alignment of investment portfolios by attaching their assessments to mathematical formulas and academic publications. Thus, scholars encountering green finance locally need to be sensitive both to the interests and values inscribed in devices by their designers and to the local effects – such as shifts in attention and valuation – that these devices help bring about.

Devices are ubiquitous within green finance and are integral to its governance and legitimacy. The present state of financial products such as bonds is being assessed with regards to their environmental impacts and subsequently categorised, for example, as light, medium, or dark green by S&P Global Ratings. The politics of such sustainability ratings becomes visible in their effects on company practices (Clementino and Perkins, Reference Clementino and Perkins2021) and their adherence to commercial imperatives such as client demand (Eccles, Lee, and Stroehle, Reference Eccles, Lee and Stroehle2020), underscoring their role as means of politics. The past of environmental impacts is likewise only made knowable through devices such as repositories of corporate GHG emissions data. Here, commercial interests push data providers to increasingly rely on models to offer comprehensive coverage of their clients’ investment universes (Kob and Dittrich, Reference Kob and Dittrich2024), raising questions regarding the possibly perverse incentive structures such modelling may create (Hoepner and Rogelj, Reference Hoepner and Rogelj2021). Furthermore, the very framework underpinning the measurement of such emissions data is inscribed with the logics of financial accounting developed for corporate entities, and as such offers opportunities for corporations to evade accountability for emissions (Walenta, Reference Walenta2021), pointing to the nature of emissions data as a forum for politics. Lastly, the future of companies’, portfolios’, and markets’ relations with the natural environment is made legible by ‘instruments of imagination’ (Beckert, Reference Beckert2016). Implied Temperature Rise scores, for instance, assess the future climate impacts of investments, while Climate Value at Risk assessments gauge the potential effects of climate policy and extreme weather events on shareholder value. Such forward-looking metrics are typically underpinned by climate scenarios, i.e. visions of specific climate futures. Within finance, central bankers have become the dominant provider of these climate scenarios through their efforts to conduct climate scenario analysis – often misleadingly termed ‘climate stress tests’ (Langley and Morris, Reference Langley and Morris2020). The politics of their development jointly with academic actors – leading to, for example, a Global North centrism and the systematic underestimation of physical risks (Taeger, Reference Taeger2022) – as well as the politics of their potential (counter-) performative effects largely remain under-researched.

As these examples demonstrate, the reliance of green finance on data, metrics, and models makes devices a fruitful – if not essential – analytical perspective to explore and understand green finance knowledge as a forum for and means of politics. While the ANT-inspired literature in the Social Studies of Finance may sit somewhat uncomfortably with the labelling of devices as a means of politics – since this implies an understanding of knowledge and technologies as mere tools whose effects depend on human wielders – this literature is nonetheless fundamentally aligned with the spirit of this label: devices can indeed both advance the interests of human actors and participate in the imposition of their value orders. A device perspective can therefore also nuance functional conceptualisations of knowledge more broadly and usefully complicate our understanding of agency as not exclusively attached to human actors.

Financial organisations as makers or takers of climate knowledge?

For financial organisations, the climate crisis poses a conflict between material interests and social norms: the search for profit often collides with the costs of decarbonisation, yet climate inaction may lead to legitimacy costs. Financial actors attempt to escape this dilemma by producing climate-related knowledge and practices that safeguard both their material interests and social positions. Understanding these strategies allows scholars to address two important aspects: how financial knowledge links to climate change, and how it is related to – often insufficient – climate mitigation. However, in the context of a growing anti-ESG backlash, how financial actors respond to wider social and political conflict over climate-related knowledge is equally important. Financial organisations are thus not only knowledge-makers but also knowledge-takers as climate-related knowledge becomes contested terrain.

How does such a conceptualization inform our understanding of the link between financial markets and climate change? Let us first consider that financial organisations face a conflict between cultural expectations regarding climate impact and their material interests. Financial actors often try to escape this predicament through epistemic work that tries to align climate-related knowledge with their material interests. This way, the production of climate-related knowledge is transformed into a means of politics, by expanding or weakening boundaries of ‘green’ finance. A key goal of such knowledge work is to influence regulation that governs financial markets to align more closely with financial actors’ material interests (Seabrooke and Tsingou, Reference Seabrooke and Tsingou2021; James and Quaglia, Reference James and Quaglia2024). This is particularly the case for the regulation of ‘sustainable’ investing, where financial actors have engaged in significant epistemic work to position themselves as knowledgeable experts on the topic at the expense of civil society actors (Tischer and Ferrando, Reference Tischer and Ferrando2024; Seabrooke and Stenström, Reference Seabrooke and Stenström2023; van der Zwan and van der Heide, Reference Van der Zwan and van der Heide2024).

Epistemic contestation also takes place within the financial sector. In the case of European ESG disclosures, institutional investors fought for keeping the standards focused on process rather than impact (Seabrooke and Stenström, Reference Seabrooke and Stenström2023). Having an impact-approach would have required more tangible and costly metrics that would pose a threat to funds labelled as ‘broad ESG’ that make up the overwhelming majority of the $40 trillion ESG market (Bloomberg Intelligence, 2024; Fichtner et al., Reference Fichtner, Jaspert and Petry2023). Large asset managers and index providers thus have an interest in expanding boundaries over what counts as ‘green’ that smaller, specialized investors do not necessarily share. However, this does not mean that these smaller funds – such as impact investors – seek to establish firm boundaries between what does and does not count as green, for example through binding standards or third-party evaluations. To the contrary, impact investors have been found to engage in boundary erosion by establishing a regime of ‘epistemic gerrymandering’ that allowed them to apply idiosyncratic understandings of ‘impact’ without a loss of legitimacy (Golka, Reference Golka2024).

Financial actors’ epistemic work also acts as a means of politics by positioning private finance as an effective way to foster climate mitigation. The success of this knowledge work is epitomised in the United Nations’ Sustainable Development Goals that explicitly call for a mobilisation of private finance – rather than an expansion of public investment – as a key policy goal (Gabor, Reference Gabor2021; Golka, Murau, and Thie, Reference Golka, Murau and Thie2024). Financial organisations have thereby succeeded in positioning private finance as an obligatory passage point for governments seeking to achieve climate mitigation (Chiapello, Reference Chiapello, Mader, Mertens and van der Zwan2020). To maintain this position, financial actors engage in considerable epistemic work to measure and explain ostensible ‘investment gaps’ and to position themselves as potential solutions. They also argue that closing the investment gap requires considerable ‘derisking’ by the state (Gabor, Reference Gabor2023). Such derisking, the financial sector claims, would mobilise unprecedented amounts of financial resources to flow towards the green transition. This has the important epistemic effect of rendering stringent regulation of green finance unnecessary as the financial ‘greening’ is presented to occur automatically, if only governments would give sufficient subsidies.

Using financial organisations as an analytical starting point invites us not only to think of knowledge as a means of politics, but also as a contested forum for politics. Consider the growing right-wing backlash against climate change. This is not only a conflict over substantive issues of climate change but a struggle over epistemic authority, that is, a jostle over whether or not the financial sector should be allowed to develop and impose climate-related rules on its portfolio companies. As described by Florida governor Ron DeSantis, financial actors pushing companies towards improving their ESG score ‘represents the imposition of a policy through extraconstitutional means.’ (Hilson, Reference Hilson2024).

How do financial actors respond to such challenges of their epistemic authority? One might think that financial actors would perceive this as a threat to their professional jurisdiction (Abbott, Reference Abbott1988) and fee income from ‘green’ products and thus resist these pressures. One example is how financial actors’ like BlackRock – whose CEO has repeatedly argued that ‘climate risk is investment risk’ (BlackRock, 2020) – respond to the current anti-ESG climate in the US. In November 2024, several Republican states sued BlackRock, Vanguard, and State Street over their ESG investment policies, claiming that they wrongfully pressure oil companies to decarbonise. Their response was to exploit the ambiguity over green financial knowledge: they argued that they act in accordance with shareholder interests (Reuters, 2024), even though, in practice, they rarely support environmental shareholder resolutions (Baines and Hager, Reference Baines and Hager2022; Golland et al., Reference Golland, Galaz, Engstrom and Fichtner2022). It thus appears that financial actors’ success in turning climate-related knowledge into an opportunity has led them to defend their epistemic authority against right-wing attacks.

The open question remains whether the re-election of Donald Trump has fundamentally altered financial actors’ calculus, as the costs of resisting the ESG-backlash may have increased while the opportunities gained from defending ESG may have waned. Part of answering this question involves studying whether financial organisations differ in their responses to the anti-green backlash. The first months after the re-election of Donald Trump gave the impression that financial actors’ resistance against anti-climate (knowledge) politics was short-lived. During this period, BlackRock exited the Net Zero Asset Managers, prompting the climate initiative to pause its operations indefinitely, and the Federal Reserve pulled out of the Network of Central Banks and Supervisors for Greening the Financial System (NGFS). However, this was not just a Trump effect, but the culmination of a longer development of climate retrenchment, as other asset managers had already left climate-finance initiatives over the previous years.

The contestation of financial actors’ epistemic authority may also create new cleavages between financial organisations defending it and those giving in to external pressures. For example, as the Big Three asset managers scaled back their climate commitments, they also faced pushback from asset owners such as New York’s pension funds who threatened to terminate mandates with asset managers with insufficient climate policies (Financial Times, 2025). Using financial organisations as an analytical starting point allows us to consider that contestations over climate knowledge in financial markets are both multi-dimensional as well as non-linear. Investigating them in more detail matters, because whether or not financial actors call for more or less stringent climate action could influence the course of the green transition.

Stabilising capitalism through imaginative displacement

Knowledge contestations do not only occur on the level of relatively contained knowledge claims but also on the level of ideology, i.e. of systems of thought and belief which serve as epistemic scaffolding for sense-making. Eagleton describes how ‘[s]uccessful ideologies are often thought to render their beliefs natural and self-evident (…) so that nobody could imagine how they might ever be different’ (Reference Eagleton2024: 58). Thus, a ruling ideology rather than engaging in a battle for ideas ‘thrust them beyond the very bounds of the thinkable’ (Eagleton, Reference Eagleton2024: 58). In doing so, ideologies are effectively enclosures of the forum of politics in the sense that they keep certain positions out of the narrowed realm of knowledge contestations. Importantly, in this case, green finance contributes to the crowding out of arguably better-suited ideologies to address climate change (e.g., Hickel, Reference Hickel2020).

One example of this would be the aforementioned ESG backlash. Not only does it contest the epistemic authority of financial institutions, but it redefines and narrows the spectrum of acceptable ideas that are considered appropriate to even discuss within the forum for politics. By framing green finance – an approach well within the limits of the ruling capitalist ideology – as fringe and radical, actual systemic challenges fall even further off the spectrum of what is considered to be ‘debatable’ within the political sphere. Or, in the words of Noam Chomsky (Reference Chomsky1998: 43): ‘[t]he smart way to keep people passive and obedient is to strictly limit the spectrum of acceptable opinion, but allow very lively debate within that spectrum’. The solidification of the ruling capitalist ideology is thus achieved by further narrowing the already enclosed forum for politics.

In general, positioning finance – a core pillar of the contemporary capitalist ideology – as a potential cure for the urgent and wide-ranging problems created in large parts by this capitalist system (e.g., Buller, Reference Buller2022) has a variety of significant implications for knowledge politics. Most notably, due to the enclosure of the forum of politics, green finance functions as a means of imaginative displacement: it not only crowds out debates on alternative macro-economic systems but naturalises capitalism as the omnipotent system that has all the answers to all of our problems (Graeber, Reference Graeber2011). If a core pillar of capitalism was in fact able to address the problems caused by capitalism itself, why would there ever be a need for a different system? Thus, the suppression of imaginative possibilities for systemic change is one of the core functions of green finance. In doing so, green finance ushers in what Mark Fisher (Reference Fisher2014) described as ‘capitalist realism’, or what we call an enclosure of the forum for politics. In Fisher’s words, that is ‘the widespread sense that not only is capitalism the only viable political and economic system, but also that it is now impossible even to imagine a coherent alternative to it’ (2, emphasis added).

This enclosure of the forum for politics is amplified by the material interests of various industry actors within finance. Banks and asset managers, for example, need to protect their significant fossil fuel exposure by minimising regulatory risks (Braun, Reference Braun2022). The risk of government intervention was arguably most salient between 2020 and the Russian invasion of Ukraine, when both the US and EU signalled their commitment to addressing climate change. Consequently, banks and asset managers needed to (at least performatively) show their willingness to voluntarily address environmental degradation – e.g., through pushes for voluntary environmental risk disclosures in focal firms, the mass creation of ESG funds, or the setting up of NZAM and NZBA – thereby highlighting their commitment to the climate cause without requiring government intervention. This strategy helped ensure that finance remained as depoliticised a space as possible, which also minimised the short-term risks to their fossil fuel assets. Thus, the short- to medium-term material interests of important field actors have contributed to the enclosure of the forum for politics, as well as the use of green finance as a means of politics in order to pre-empt regulatory intervention. In doing so, green finance contributes to the solidification of financialized capitalism as the hegemonic ideology.

If we strip away the ways green finance reinforces capitalist realism, it seems rather surprising that Western governments have embraced the notion that finance – an industry that has significantly contributed to the ongoing climate crisis (e.g., Niranjan, Reference Niranjan2023; Semieniuk et al., Reference Semieniuk, Holden, Mercure, Salas, Pollitt, Jobson, Vercoulen, Chewpreecha, Edwards and Viñuales2022) – is now positioned to lead efforts in resolving it (Gabor, Reference Gabor2021). This is especially perplexing considering that (a) finance continues to operate within an economic system that has been only marginally reformed from the one that fostered neo-colonialism, extractivism, and environmental catastrophe, and (b) the financial sector has been increasing, rather than decreasing, its exposure to fossil fuel assets (Banking on Climate Chaos, 2025; Hickel, Reference Hickel2020). But, as an agent of capitalist realism, green finance has contributed to the reproduction of a ‘pervasive atmosphere’ that acts as a ‘kind of invisible barrier constraining thought and action’ (Fisher, Reference Fisher2014: 16). Thus, despite the largely devastating record of capitalism when it comes to addressing societal challenges (e.g., Hickel, 2017, Reference Hickel2020), incrementalist solutions that dominate the realm of green finance seem to be enough to neutralise any contestations of the capitalist system itself. As David Graeber put it: ‘the war against the imagination is the only one the capitalists have actually managed to win’ (Reference Graeber2011: 113) – and green finance has played an important part in that.

This fortification of the forum for politics can take at least two different forms. First, green finance can occupy time and space, drawing attention to its own interpretations of the problem and the financialised solutions it proposes. Second, it can guard the relations and territories it dominates against potential competitors.

The former move of occupying time and space is illustrated by the so-called Finance Day at COP26 in Glasgow. After the ceremonial opening of the climate conference and two days of high-level announcements by policymakers, a series of thematic days structured the programme. Finance not only occupied a full day of this eight-day schedule, but in fact occupied the very first one, prior to topics such as Youth and Public Empowerment or Gender. It opened with the launch of the Glasgow Financial Alliance for Net Zero (GFANZ), a – now disintegrating – voluntary financial sector initiative which promised to align the $130 trillion represented by its members with net-zero goals. Thus, the financial sector successfully used (up) the unique spotlight and global attention by policymakers and the public alike to present their answer to the question of how to fund climate-related investments: through voluntary self-organisation of the financial sector.

The latter move of guarding becomes visible when tracing the framing of fiduciary interests through the investment chain. In principle, a significant portion of global capital is ultimately owned by the general (Global North) population via pension or insurance funds, rendering popular sustainability interests a potential force in guiding capital allocation. In practice, however, the general population is far removed from investment decisions, and their interests are commonly assumed to align with those of an imaginary homo oeconomicus, with singular, solely pecuniary value preferences, similar to the stylised imagined user of financial statements (Young, Reference Young2006). On the rare occasions when members of the general public are brought closer to actual investment decisions, for example, as trustees in pension funds, they are typically advised by professional consultants whose recommendations frame environmental concerns according to financial logics of profit maximisation and modern portfolio theory, which trustees tend to follow (Cooper and Millo, Reference Cooper and Millo2025). Thus, green finance crowds out alternative formulations of interests and values according to which capital could be allocated by guarding its existing practices from transformation.

To illustrate the consequences of a fortified forum of politics, we have argued that the reinforcement of capitalist realism through green finance inherently leads to a de-politicisation of the debate on how to address climate change. This, in turn, de-contests knowledge claims about where change originates, situating responsibility at the individual rather than societal level, which is in line with a market-conform conceptualisation of agency. Powerful financial institutions benefit from this shift toward individual responsibility as it neutralises systemic threads that might otherwise fundamentally challenge their business models.

What these effects of the enclosure of the forum of knowledge politics suggest is that, while ideologies are not necessarily a means deployed strategically and consciously by a distinct set of actors, they nonetheless systematically further particular sets of interests and value systems. Hence, knowledge as ideology should also be understood as a means of the politics of capitalist reproduction and fortification, precisely by virtue of not being a forum for any politics. The very absence of contention renders it a powerful means of knowledge politics.