Complexity of Adoption: An ISM Model of Impediments for Social Responsibility Investment in Pakistan

Abstract

Sustainable practices significantly reduce carbon footprints, climate change, and the toxic pollutants released into the atmosphere. Socially Responsible Investment (SRI) practices are emphasized and are required immediately. The concept of SRI was introduced and is becoming increasingly widespread. Still, this practice is hindered at the different stages of its adoption. The present study aims to identify the impediments to implementing the SRI system. The study is conducted in two basic steps: extensive literature review and ISM model formation. A panel of 13 experts was used to finalize the list of 15 impediments further used in ISM. MICMAC analysis was used to classify the impediments in different clusters based on their dependence and driving powers. After analyzing the contextual relationships of the impediments of SRI, a hierarchical model was formed, presenting the different levels of the barriers. The findings revealed that lack of investors’ confidence, high implementation cost, communication gaps, lack of state support, unclear environment protection laws, and complex regulatory frameworks are the foremost impediments to the SRI implementation system. The identified impediments of SRI can be helpful for the establishment of sustainable projects for making policies and regulatory frameworks. Individual investors can benefit from this study by analyzing the impediments of SRI and making their investment portfolios accordingly.