Sustainable investment funds and the government: a comparative study on public policies in the Netherlands and Belgium

With the growing awareness of sustainable development, some European governments have implemented public policy with respect to sustainable investment funds aimed at individual investors. In this article, the public policies of two European central governments are compared: the Dutch Groenregeling and the Belgian Kringloopfonds. On the basis of intervention theory and Hanbergen’s evaluation framework (2001), we claim that public policy can impact upon the sustainable investment market, but that the outcomes of the public policy depend on how that policy is designed. Governments are likely to have a choice between a private and a public approach, in which private and public sustainable investment funds, respectively, play a key role. It is argued that a private approach, owing to the absence of uncertainty, in comparison to a public approach and the presence of a higher intermediation rate for sustainable investment funds, attracts more investors, leads to more sustainable investment funds being established as well as to more assets under management and sustainable projects being financed.