English-language abstracts of publications in Russian

The reason for writing this article was the release of the first Russianlanguage textbook on sustainable finance. Its critical analysis, presented in the article, is aimed at creating more comprehensive textbooks on sustainable finance in the future. In addition, in recent years, the author has been actively involved in reviewing university curricula in the field of finance, the results of which can be used to draw an extremely disappointing conclusion about the significant lag in teaching finance in Russia compared to the best world examples. Against the background of the emergence of a new paradigm of finance in connection with the creation and strengthening of the sustainable development model, Russian teachers are guided not just by the old traditional paradigm of finance, but by its version from about 20 years ago. The article contains proposals for the formation of a program of courses on sustainable finance, as well as for taking this concept into account in traditional university courses on finance and individual industry financial disciplines. The author’s view on the selection of literature for courses on sustainable finance is also offered.

Keywords: sustainable finance, sustainable development, ESG, master’s programs, textbooks, responsible investment.

JEL: A23, G19, G29, G30, Y30.

There is growing evidence that the financial structure depends on the level of economic development of the country. In developed countries, firstly, there is a convergence of financial structures and, secondly, an increase in the share of non-bank financial intermediation sectors in national financial systems. Therefore, we propose to proceed to the analysis of the three-tier structure of the financial sector (banks – non-banking financial institutions – financial markets), for which we have developed new indicators that assess the relationship between a non-bank financial intermediation sector and financial markets. They showed that in the last 7–8 years in Russia there has also been an outstripping growth of this sector. Our regression studies, firstly, have confirmed the conclusion that in Russia the financial structure (in the traditional sense) slows down economic growth and, secondly, allowed us to assume (based on the results of a cross-country analysis) that the current structure of the Russian financial sector (with a predominant share of banks) contributes to an increase in the volatility of economic growth. The behavior of the new financial structure ratios and regression analysis based on traditional financial structure ratios indicate the need to adjust government policy in the financial sector in order to ensure faster growth of financial markets.

Keywords: financial structure, credit, capitalization, banks, financial markets, non-banking financial institutions, economic growth, economic growth volatility, convergence of financial systems.

JEL: F43, G18, G20, G23, O16.

Abstract The article considers the main techniques for establishing the kind of long-term trust that is necessary for making responsible investments that are consistent with the principles of sustainable development and that will produce the long-term value which is the main goal of corporations participating in sustainable finance. The creation of such techniques is being carried out in close cooperation with international financial organizations and market participants. In order to make current thinking about sustainable financing more systematic, especially as it applies to building long-term trust, the author has concentrated on providing useful descriptions. The article describes the current progress toward standards for the disclosure of non-financial information by corporations; creation of taxonomies for sustainable activities and their application in financial markets; introduction of verification that corporate activities comply with the taxonomies for sustainable activities; and the development and use of ESG ratings in responsible investment. The main research method is analysis of documents of international (including financial) organizations, associations of financial market participants, large business associations, development institutions, and rating agencies. The problematic areas of the mechanisms being constructed are identified (primarily with respect to disclosure of non-financial information and the development of ESG ratings), and the article provides recommendations from international financial organizations on how to overcome the problems identified. The process of developing standards for disclosure of non-financial information and ensuring its reliability, both of which are necessary for sustainable investment, is proceeding rapidly. The article is addressed to a wide variety of readers, who should find it useful for learning how sustainable finance principles are being put into practice by corporations and financial markets. The information in this article can be used for developing strategic economic policy where it intersects with sustainable development.

The article provides information on the latest developments in the field of building sustainable finance standards  as an integral element of the sustainable development model. The rapid growth of responsible investment naturally created a demand for the formation of principles and standards both for responsible investors themselves and for corporations wishing to attract responsible investments. The development of standards, norms and rules that ensure the effectiveness of responsible investments is carried out in close cooperation with international financial organizations, associations of market participants and regulators. The article presents a general picture of this process, including information about its main participants, their most important decisions and achievements in the field of implementing the concept of sustainable finance. It is divided into 4 blocks. The first block talks about the rules and regulations for responsible investment, including the requirements developed by such investors in relation to themselves. The second block briefly describes the process of standardizing the disclosure of non-financial information and the problems of ensuring its reliability. The standards for disclosure and confirmation of the reliability of information about the adherence of corporations to the principles of sustainable development create the basis for the formation of long-term trust, which is a prerequisite for the functioning of the sustainable development model. The third block briefly describes the styles of responsible investing and the trends in their application. The fourth block is devoted to proposals and projects for central banks to change their monetary policy in order to stimulate responsible investment. The article is aimed at the widest range of readers interested in the problems of responsible investment, focusing on the most important documents in this area developed abroad in recent years. 

The article proposes a set of indicators of the financial structure. This set of indicators is built on the basis of an approach that takes into account significant changes in the financial structure of the world’s largest economies, including Russia, after 2008. Taking into account that the share of non-banking financial institutions has sharply increased within the framework of the financial structure, it is advisable to move from a two-tier form of presentation of the financial structure («banks – financial markets») to a three-tier one («banks – non-banking financial institutions – financial markets»). The proposed set of indicators can become a methodological basis for applied analysis of the financial structure in various countries of the world, including Russia, as well as at the global level.

This article presents classification of existing concepts of the efficiency of the financial sector. Proposed the hypothesis that assessments of the microeconomic and informational efficiency of the financial sector are fundamentally based on the concept of transaction costs. Suggested a number of indicators for assessing the macroeconomic efficiency of the financial market and their approbation on the Russian data. We identified four areas for assessing the effectiveness of the financial sector, differing in the level of consideration, recognition of the principle of rationality, accounting for transaction costs: assessing the macro-efficiency of the financial sector; information-efficient market hypothesis; the concept of adaptive markets. The assumption is formulated that the concepts studying the efficiency of financial systems at the micro level, as well as the efficient market hypothesis, are based on the principle of minimizing transaction costs. While there is a significant theoretical backlog on the issue of macroeconomic efficiency of the financial sector, there is a shortage of quantitative estimates, so we tried to offer a number of such indicators, focusing on the functions of financial markets in a developing economy. The article constructs the estimates of the macroeconomic efficiency of the Russian financial market from two sides of the process of transforming savings into investments (attracting investments by enterprises and placing savings by households).

The article provides a brief overview of the concepts that substantiate the feasibility of moving from the classical paradigm of finance to a new paradigm of sustainable finance. In the modern world, there is a sharp increase in the number of works on the problems of sustainable finance. At the same time, the number of theoretical works in this area is insignificant, and they are underrepresented in leading scientific journals. The concept of sustainable finance has several key elements, including a new interpretation of the value of corporations and securities (which takes into account environmental and social externalities), long-term value creation as the main corporate goal, the adaptive markets hypothesis. All these elements are based on the initial thesis about the need to combine financial and nonfinancial (social and environmental) goals in the development of corporations, which is followed by an increasing number of investors. Accordingly, supporters of the concept propose a revolutionary transition to a new paradigm, trying to refute such fundamental concepts of the traditional paradigm of finance as the efficient markets hypothesis and the capital asset pricing model. A natural continuation of attempts to refute these concepts are practical recommendations of sustainable finance for financial organizations, suggesting a change in the approach to diversification, preference for passive investment, a reduction in the investment chain, etc. A certain justification for such claims is given by a sharp increase in the share of responsible investors (investors who share the ESG principles) in the total volume of investments under professional management. In addition, special attention to sustainable finance is predetermined by the growing importance of the UN Sustainable Development Goals, one of the instruments for the implementation of which is sustainable finance.

The article attempts to formulate the main characteristics of the concept of sustainable finance and determine its place among other concepts. Its certain autonomy from the concept of sustainable development is emphasized. Indicators are presented that demonstrate the outstripping growth of sustainable finance in the modern world, and assumptions about the reasons for this trend. The problem of the adequacy of rating assessments of corporate adherence to ESG principles is briefly touched upon, which turned out to be the weak point of the concept of sustainable finance. The current state of the concept of sustainable finance in Russia is assessed, the main obstacles to its implementation and feasibility are determined. Proposals are formulated for public policy measures that can stimulate the formation of domestic responsible investors in Russia, as well as other measures that will contribute to the implementation of the concept of sustainable finance.

The article touches upon one of the most problematic areas of introducing the concept of sustainable finance into the practice of functioning of financial markets and institutions. The most famous international ESG ratings are briefly described. The conclusions of a number of works on the reasons for the imperfection of ESG ratings, including a significant range of ratings of the corporation from different rating agencies, are summarized. The current situation in the field of the formation of rating assessments and indices of sustainable development in Russia is described, in which the same shortcomings that are characteristic of international ratings are manifested in an exaggerated form.

Abstract. The study is devoted to the problem of linking financial development strategies with socio-economic development strategies in terms of matching the target indicators of such strategies related to different levels of the hierarchy of strategic planning documents. The isolation of financial development from the goals and priorities of socio-economic development in Russia begins with strategic planning. This is most clearly manifested in the discrepancy between target indicators of these two levels of strategic planning. The article presents 4 options for a complex of financial development indicators linked to the goals and objectives at the upper level of strategic planning. Their development was based on the analysis of the impact of individual parameters of financial development on the parameters of socio-economic development and global competition of the national financial sector; individual areas of financial development on financial development in general, as well as on isolating the role of financial regulators in raising the level of financial development of the country. These indicators were suggested while providing expert support for the development of various financial development strategies, but their use as a whole, as a complex of indicators, was hindered by departmental interests. In the process of interdepartmental discussions, a complex of target indicators subject to a single logic was replaced by unrelated, easily achievable indicators, or fundamentally unmeasurable indicators. The main contribution of this article is drafting of a complex of target indicators for financial development, as well as making conclusions from the experience of their practical application / non-application.

Abstract. The work assesses the impact of a number of socio-cultural factors, which are based on Hofstede’s variables, on financial development. Using cross-country analysis, the authors identified three socio-cultural dimensions that have a significant impact on the Financial Development Index, which was used as an integral measure of national financial development: individualism, tolerance (acceptability), and long-term orientation. Based on the results obtained, recommendations were formulated for adjusting the state influence on socio-cultural factors in the Russian Federation. In our opinion, it is necessary to maintain a long-term orientation as an advantage and overcome the lack of tolerance and individualism. Since financial development contributes to economic growth and overcoming inequality, such an adjustment of socio-cultural parameters (in general, extremely inertial) will have a positive effect on the parameters of socio-economic development of Russia in the long term.

Abstract. The article discusses the concept of "Finance and Politics", which describes the influence of the political structure on financial development. It is shown that this concept actually moved away from the search for the basic factor of financial development and became a bridge to the currently prevailing concept of the existence of a complex of determinants of financial development. This concept is separating the political systems of competitive capitalism, which stimulates faster financial development, from the relationship capitalism, which suppresses financial development, especially relevant for Russia. A comparison of this concept with other concepts describing the transition to a higher stage of development of society (including "access orders" and inclusive growth concepts) is presented. Considering the theoretical and methodological value of the concept of "Finance and Politics", it is proposed to create quantitative criteria for attributing countries to a particular type of capitalism, thereby removing barriers to using the concept in empirical research. Preliminary results of approbation of this approach have shown its promise.

The article provides some assumptions and hypotheses that have arisen as a result of a critical analysis of a new generation of crisis predictors. Three assumptions/hypotheses are submitted to the reader’s court: 1) on the possible impact of the negative spread of the yield on US Treasury bonds on the decisions of the US Federal Reserve; 2) on the effect of the central banks fulfilling the financial stability function on their monetary policy; 3) on the existence of objective reasons for Russia’s later entry into the global crisis of 2007—2009. The latter circumstance, along with the fact that some of the Russian recessions have significant internal causes, indicates the need for forming domestic crisis predictors. The assumptions and hypotheses cited in the article are debatable.

Keywords: crisis predictors, financial markets, economic growth, financial stability, profitability spreads, financial structure, financial condition index.

JEL: E32, E43, E44, E58, G01, O16.

The article examines the influence of the financial structure on the volatility of economic growth and on the volatility of the dynamics of fixed capital investments. Based on the analysis of the literature, a hypothesis was formulated that in economies with a market-based financial sector, macroeconomic volatility is lower. This hypothesis was confirmed within the framework of regression equations in which the dependent variables were the standard deviation of the annual growth rates of real GDP per capita and the standard deviation of the annual growth rates of fixed capital investments. The banking segment increases the volatility of macroeconomic parameters, while non-bank financial institutions and financial markets reduce it. At the same time, the significance of the influence of financial structure indicators on the volatility of macroeconomic parameters turned out to be lower than the significance of the indicators of volatility of the terms of trade and investment openness. However, given that the optimization of the financial structure is available to the authorities implementing economic policy and does not have negative consequences, it can be a very effective tool for protecting against the impact of external shocks on the Russian economy.

Key words: financial structure, GDP, volatility of economic dynamics, investment volatility, financial sector, mitigation of external shocks, banking segment, financial markets, non-bank financial institutions.

Abstract

The macroeconomic stabilization that took place in Russia has led to a partial transfer of household savings from bank deposits to the securities market. This process determines the relevance of creating institutions to minimize the non-market risks of small investors. As global experience shows, among such institutions, the most important one is the compensation fund. The article discusses projects for the creation of a compensation fund in Russia, previously proposed by the Bank of Russia and the National Association of Stock Market Participants (NAUFOR). The results of recalculating the forecast balance of the compensation fund are presented, based on the previously formulated prerequisites of NAUFOR, but also underpinned by the latest quantitative data, which have changed significantly over the past two years as a result of explosive growth of household investments in the securities market. It is shown that in the new conditions it is impossible to ensure the adequacy of financing of compensation funds on the basis of previously proposed sources. The author presents a new approach to the formation of a compensation fund in Russia, which takes into account not only the new Russian realities, but also the existing global experience in the field of creating compensation funds. In the framework of this approach, the author proposes expanding the list of financing sources for the compensation fund. The article provides forecast estimates of the fund balance and ratios of compensation fund adequacy, calculated on the basis of these proposals, which indicate that this model of the compensation fund is economically viable and could be implemented as soon as possible. Further prospects for the development of a national compensation system, which could include compensation funds operating in various segments of the financial market, are considered.

Keywords: compensation fund, household savings, stimulation of long-term investments, protecting the interests of investors, individual investment accounts, securities, compensation system, non-market risks.

JEL: G18, G20, G23, G28