The role of labelling in building a market.

Summary Socially responsible investment (SRI) in France remains underdeveloped for retail investors, despite the strong growth of SRI funds and the launch of labels for them. The objective of this article is to better understand the limited role of labels. The analysis is based on the interaction between three elements: labels and information asymmetry, choice of informational attributes of labels and objectives of labeling organizations, and competition between labels. Two factors explain the limited impact of labels. First, the informational attributes highlighted by the labels reflect the point of view of management companies rather than that of individual investors. Secondly, SRI is mainly distributed to retail investors through the banking and insurance networks, for which SRI does not constitute a real competitive differentiator.