In order to resolve the issue, ensure that the above variables are set correctly for your Informatica instance and Operating System for the OS user that runs the Informatica Agent where the Agent/Service Manager is installed. Once changes are made to any of these variables, make sure to restart both the Agent and ServiceManager processes for them to take effect. The "Select" folder button should then work from the RA Informatica Agent.
Example of Windows Environment Variables Settings:
Example of UNIX/Linux Environment Variable Settings: