Sustainable and socially responsible investing

Humanomics ◽  
2013 ◽  
Vol 29 (3) ◽  
pp. 164-186 ◽  
Author(s):  
Saeed BinMahfouz ◽  
M. Kabir Hassan
Keyword(s):  
Systematic Risk ◽  
Value Systems ◽  
Socially Responsible ◽  
Screening Process ◽  
Content Type ◽  
Responsible Investment ◽  
Sustainability Criteria ◽  
Fama And French ◽  
Investment Portfolios ◽  
The Impact

PurposeThere is a great deal of research that has been done to investigate the investment characteristics of conventional socially responsible investment portfolios compared to their broader conventional counterparts. However, the impact of incorporating sustainability criteria into the traditional Sharia screening process has not so far been investigated. Therefore, the study aims to give empirical evidence as to whether or not incorporating sustainability socially responsible criteria in the traditional Sharia screening process has a significant impact on the investment characteristics of the Islamic investment portfolio.Design/methodology/approachThe paper examines the investment characteristics of four groups of investment portfolios mainly, Dow Jones Global Index, Dow Jones Sustainability World Index, Dow Jones Islamic Market World Index and Dow Jones Islamic Market Sustainability Index. To improve the robustness of the study, the analysis was carried out at different levels. First, absolute mean return and t‐test were used to examine whether the difference between the different groups of investments is statistically significant or not. Second, risk adjusted equilibrium models, both single‐index and Fama and French multi‐index, were employed. This is to control for different risk exposure and investment style bias associated with different investment portfolios examined.FindingsThe paper finds that neither the Sharia nor the sustainability screening process seems to have an adverse impact on the performance and systematic risk of the investment portfolios compared to their unrestricted conventional counterparts. Therefore, Muslim as well as socially responsible investors can choose investments that are consistent with their value systems and beliefs without being forced to sacrifice performance or expose to higher systematic risk.Originality/valueThe study contributes to the existing literature by giving new evidence on the impact of incorporating sustainability criteria into the traditional Sharia screening process that has not so far been investigated.

The effects of materialism on consumer evaluation of sustainable synthetic (lab-grown) products

2020 ◽  
Vol 37 (5) ◽  
pp. 579-590
Author(s):  
Jessica Keech ◽  
Maureen Morrin ◽  
Jeffrey Steven Podoshen
Keyword(s):  
Design Methodology ◽  
Socially Responsible ◽  
Content Type ◽  
Consumer Evaluation ◽  
Positioning Strategy ◽  
Consumer Markets ◽  
The Future ◽  
Promotion Strategies ◽  
Alternative Sources ◽  
The Impact

Purpose The increasing desire of consumers for socially responsible luxury products combined with fluctuating supplies in consumer markets are leading various industries to seek alternative sources to be able to meet the needs of its customers. One possible solution that may meet the demands of the future is lab-grown products. Because these products confer multiple benefits, this study aims to investigate the most effective ways to appeal to consumers by aligning the benefits of the products with their values as marketers seek to find effective promotion for these items. Design/methodology/approach We examine the effectiveness of an ethical positioning strategy for two types of luxury lab-grown (synthetic) products among high versus low materialism consumers in three experiments. Findings Findings suggest that a positioning strategy stressing product ethicality is more effective for low materialism consumers, whereas the strategy is less effective, and may even backfire, for high materialism consumers. The impact on social status consumers perceive from a lab-grown product explains why this effect occurs among low materialism consumers. Therefore, marketers should take caution and use specific appeals for different segments based on values such as consumers’ materialism levels. Originality/value If lab-grown products represent the wave of the future, it is important to understand how consumers will respond to this emerging technology and how promotion strategies may enhance their evaluation.

Impact of values on the learning approaches of Chinese construction students in Hong Kong

2014 ◽  
Vol 21 (5) ◽  
pp. 481-504 ◽  
Author(s):  
Mei-yung Leung ◽  
Chen Dongyu ◽  
Anita M.M. Liu
Keyword(s):  
Hong Kong ◽  
Interpersonal Relationships ◽  
Personal Values ◽  
Value Systems ◽  
Limited Attention ◽  
Learning Approaches ◽  
Personal Integrity ◽  
Content Type ◽  
Learning Behaviours ◽  
The Impact

Purpose – The purpose of this paper is to explore the influence of personal values on students’ learning behaviours. Hong Kong construction students are often criticized, by both practitioners and educators, as rote learners. To improve students’ learning processes, extensive research on a variety of aspects of construction education has been conducted. However, limited attention has been paid to the influence of personal values on students’ learning behaviours. The impact of personal value factors on the learning approaches of Chinese construction students in Hong Kong is investigated. Design/methodology/approach – A questionnaire survey was conducted to ethically Chinese construction students in four universities in Hong Kong. A total of 820 questionnaires were distributed and 431 valid returns were collected. Findings – The survey identified six influential values (namely, personal integrity, conservatism, determination, discipline, interpersonal relationships, and achievement), and shows that students who emphasize the virtues of personal integrity, determination, and a positive attitude toward achievement are better able to handle their interpersonal relationships, which will eventually lead them to engage in deep learning. Originality/value – Work to develop appropriate value systems is thus recommended in freshmen courses, as is the use of cooperative learning approaches. Such value systems will have a long-term influence on the learning approaches of construction students.

Private ethical fund investors across countries and time: a survey-based review

2015 ◽  
Vol 7 (4) ◽  
pp. 379-411 ◽  
Author(s):  
Anett Wins ◽  
Bernhard Zwergel
Keyword(s):  
Keyword Search ◽  
Relevant Literature ◽  
Future Research ◽  
Socially Responsible ◽  
Screening Criteria ◽  
Content Type ◽  
Responsible Investment ◽  
Private Investors ◽  
Ethical Funds ◽  
Fund Portfolio

Purpose – This paper aims to provide an overview of the literature to point out similarities and differences among private ethical investors across countries and time. Over the past three decades, many surveys have been conducted to advance the understanding of the demographic characteristics, motivation and morals of private ethical investors across countries and time. To date, the survey-based evidence on private investors into ethical funds is geographically rather segmented, and the research questions are fairly diverse. This permits only very temporally or regionally selective conclusions. Thereby, the authors identify interesting topics for future research. Design/methodology/approach – To identify the relevant literature for our review, the authors carried out a structured Boolean keyword search using major library services and databases. Findings – When questions about negative screening criteria are presented in a direct investment context, the consensus of private ethical investors “worldwide” (on average) is that social screening issues are most important, followed by ecological and moral topics. The percentage of ethical funds in the fund portfolio of the average private ethical investor in Europe seems to increase when the investor exhibits high degrees of pro-social attitudes and perceived consumer effectiveness. European private ethical investors are of the opinion that ethical funds perform worse but are less risky than conventional funds. Practical implications – The authors make suggestions on how investment companies should design their funds so that they can attract more socially responsible investors. Originality/value – The paper is of particular value because it focuses on private investors in the fast growing retail market of socially responsible investment funds.

Understanding how social responsibility drives social innovation: characteristics of radically innovative projects

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Duygu Turker ◽  
Y. Serkan Ozmen
Keyword(s):  
Social Responsibility ◽  
Social Innovation ◽  
Socially Responsible ◽  
Content Type ◽  
Radical Innovations ◽  
Award Winning ◽  
Innovation Characteristics ◽  
Sustainability Challenges ◽  
Corporate Social ◽  
The Impact

PurposeThis study aims to analyze how corporate social responsibility (CSR) initiatives address sustainability challenges by focusing on the congruence between process and outcome variables of CSR.Design/methodology/approachFollowing a theory-driven model, a content analysis was conducted on 63 award-winning social responsibility projects.FindingsThe study reveals that the adoption of a proactive approach during environmental assessment, which manifests itself in a focus on emerging sustainability challenges with a deeper interest, affects the centrality of social responsibility initiative by increasing its learning and partnership potential and leads organizations to produce radical innovations.Practical implicationsThe findings provide a valuable understanding for practitioners on organizing the decision making process of CSR initiatives in order to unlock its learning potentials.Social implicationsRadically innovative projects with their higher levels of proactivity, centrality and generalizability are better than incremental ones at transferring and integrating company resources and capabilities to address emergent sustainability challenges.Originality/valueThe impact of CSR on society and nature has been a neglected area of literature. To reduce this gap, this study analyzes how the configuration of process variables shapes the outcomes of socially responsible initiatives on sustainability. It also provides a new typology on the relevance of CSR initiatives to company mission/model that can show how CSR can unlock organizational learning and innovation potentials.

Towards a more ethical market: the impact of ESG rating on corporate financial performance

2019 ◽  
Vol 15 (1) ◽  
pp. 11-27 ◽  
Author(s):  
Giovanni Landi ◽  
Mauro Sciarelli
Keyword(s):  
Data Analysis ◽  
Corporate Social Performance ◽  
Stock Exchange ◽  
Social Performance ◽  
Panel Data Analysis ◽  
Abnormal Returns ◽  
Socially Responsible ◽  
Content Type ◽  
Corporate Social ◽  
The Impact

Purpose This paper fits in a research field dealing with the impact of Corporate Ethics Assessment on Financial Performance. The authors argue how environmental, social and governance (ESG) paradigm, meant to measure corporate social performance by rating issuance, can impact on abnormal returns of Italian firms listed on Financial Times Stock Exchange Milano Indice di Borsa (FTSE MIB) Index, developing a panel data analysis which runs from 2007 to 2015. Design/methodology/approach This study aims at exploring whether socially responsible investors outperform an excess market return on Italian Stock Exchange because of their investment behavior, testing statistically the relationship between the yearly ESG assessment issued by Standard Ethics Agency on FTSE MIB’s companies and their abnormal returns. To verify the impact of an ESG Rating on a company’s abnormal return, the authors developed a panel data analysis through a Fixed Effects Model. They measured abnormal returns via Fama–French approach, running a yearly Jensen’s Performance Index for each company under investigation. Findings The empirical results denote in Italy both a growing interest to corporate social responsibility (CSR) and sustainability by managers over the past decade, as well as an improving quality in ESG assessments because of a reliable corporate disclosure. Thus, despite investors have been applying ESG criteria in their stock – picking operations, the authors found a not positive and statistically significant impact in terms of market premium, when they have been undertaking a socially responsible investment (SRI). Practical implications The findings described above show that ethics is not yet a reliable fundraising tool for Italian-listed companies, despite SRIs having a positive growth rate over past decade. Investors seem to be not pricing CSR on Stock Exchange Market; therefore, listed companies cannot be rewarded with a premium price because of their highly stakeholder oriented behavior. Originality/value This paper explores, for the first time in Italy, when market extra-returns (if any) are related to corporate social performance and how managers leverage ethics to build capital added value.

The impact of gender and ethnic diversity on REIT operating performance

2019 ◽  
Vol 45 (1) ◽  
pp. 72-84 ◽  
Author(s):  
Robert Hogan ◽  
Daniel Huerta
Keyword(s):  
Ethnic Diversity ◽  
Middle Management ◽  
Operating Performance ◽  
Socially Responsible ◽  
Content Type ◽  
Return On Equity ◽  
The Board Of Directors ◽  
Managerial Positions ◽  
Funds From Operations ◽  
The Impact

Purpose The purpose of this paper is to examine the relationship between gender and ethnic diversity in managerial positions and Real Estate Investment Trust (REIT) operating performance. Design/methodology/approach The authors employ two-stage Heckman correction models on an unbalanced panel of US Equity REITs for the time period from 2000 to 2015. The second-stage model uses multiple operating performance measures regressed on a dichotomous variable that indicates if the REIT promotes diversity in middle management in addition to a vector of control variables. Findings The results indicate that REITs that promote diversity in middle management with profit-and-loss responsibilities have lower operating performance than comparable counterparts. That is, gender and demographic diversity is negatively related to REIT performance as measured by return on assets, return on equity and funds from operations. Practical implications The analysis indicates that while gender and ethnic diversity is socially responsible and may provide many benefits, diversity among managers and decision makers has to be carefully implemented in order to achieve positive financial results. Originality/value This paper contributes to the literature by investigating whether diversity in leading managerial positions, other than in top officer ranks and on the board of directors, have an impact on REIT operating performance.

Religion vs ethics: hedge and safe haven properties of Sukuk and green bonds for stock markets pre- and during COVID-19

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Muhammad Abubakr Naeem ◽  
Mustafa Raza Rabbani ◽  
Sitara Karim ◽  
Syed Mabruk Billah
Keyword(s):  
Stock Markets ◽  
Economic Stress ◽  
Low Risk ◽  
Sufficient Evidence ◽  
Safe Haven ◽  
Socially Responsible ◽  
Content Type ◽  
Hedge Ratios ◽  
Regulatory Bodies ◽  
Investment Portfolios

Purpose This study aims to examine the hedge and safe-haven properties of the Sukuk and green bond for the stock markets pre- and during the COVID-19 pandemic period. Design/methodology/approach To test the hedge and safe-haven characteristics of Sukuk and green bonds for stock markets, the study first uses the methodology proposed by Ratner and Chiu (2013). Next, the authors estimate the hedge ratios and hedge effectiveness of using Sukuk and green bonds in a portfolio with stock markets. Findings Strong safe-haven features of ethical (green) bonds reveal that adding green bonds into the investment portfolios brings considerable diversification avenues for the investors who tend to take fewer risks in periods of economic stress and turbulence. The hedge ratio and hedge effectiveness estimates reveal that green bonds provide sufficient evidence of the hedge effectiveness for various international stocks. Practical implications The study has significant implications for faith-based investors, ethical investors, policymakers and regulatory bodies. Religious investors can invest in Sukuk to relish low-risk and interest-free investments, whereas green investors can satisfy their socially responsible motives by investing in these investment streams. Policymakers can direct the businesses to include these diversifiers for portfolio and risk management. Originality/value The study provides novel insights in the testing hedge and safe-haven attributes of green bonds and Sukuk while using unique methodologies to identify multiple low-risk investors for investors following the uncertain COVID-19 pandemic.

The impact of corporate social responsibility on financial distress: evidence from developing economy

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Muhammad Farooq ◽  
Amna Noor
Keyword(s):  
Corporate Social Responsibility ◽  
Financial Distress ◽  
Z Score ◽  
Socially Responsible ◽  
Content Type ◽  
Financial Firms ◽  
Responsible Behavior ◽  
Corporate Social ◽  
The Impact ◽  
Practical Implications

Purpose This study aims to explore the role of corporate social responsibility (CSR) on the likelihood of financial distress for a sample of 139 Pakistan Stock Exchange (PSX) listed firms throughout 2008–2019. Design/methodology/approach The dynamic generalized method of moments (GMM) estimator is used to examine the impact of CSR on financial distress. The investment in CSR is measured through a multidimensional financial approach which comprises the sum of the contribution made by the company in the form of charitable donation, employees’ welfare and research and development, while the Altman Z-score is used as an indicator of financial distress. The higher the Z-score, the lower will be the probability of financial distress. Findings The authors find a significant positive impact of CSR on financial distress in GMM model. This finding is consistent with the shareholder view and over-investment hypothesis of CSR as management makes an investment in CSR to get personal benefits, which resultantly leads the firm toward financial distress state. Further, this positive relationship remains present for firms having strong involvement in foreign business through exports. Research limitations/implications Like other studies, the present study is not free from limitations. First, financial firms are skipped from the sample, although literature witnesses a lot of studies highlight the financial firms’ commitment to achieving CSR goals. Second, financial distress occurs in different stages, and this study fails to establish a linkage between CSR engagement at different stages of financial distress. In the future, researchers can make valuable addition by covering these missing links in present studies. Practical implications Findings suggest several practical implications. For policymakers, they should encourage firms to adopt more socially responsible behavior as it not only prevents them from distress but also comes with better investment behavior, minimize bankruptcies and make economies more strong and stable. Second, results suggest corporate managers emphasize socially responsible behavior as its benefits are beyond the “societal benefits” as it lessens financial distress through lower cost of debt, lesser financial constraints and reduced cost of information asymmetry, and it minimizes the cost of capital. Lastly, investors make risk premium assessments related to future earnings by determining the likelihood of financial distress in the future. Originality/value The study extends the body of existing literature on CSR and the likelihood of financial distress in Pakistan, which is according to the best knowledge of the authors, not yet studied before. The results suggest that policymakers may pay special attention to the quality of CSR while predicting corporate financial distress.

scholarly journals The impact of socially responsible investment index constituent announcements on firm price: evidence from the JSE

2012 ◽  
Vol 15 (4) ◽  
pp. 429-439 ◽  
Author(s):  
Chimwemwe Chipeta ◽  
Olga Gladysek
Keyword(s):  
Global Financial Crisis ◽  
Abnormal Returns ◽  
Total Sample ◽  
Socially Responsible Investment ◽  
Socially Responsible ◽  
Event Window ◽  
Responsible Investment ◽  
Study Methodology ◽  
The Global Financial Crisis ◽  
The Impact

This paper examines whether Socially Responsible Investment (SRI) Index constituent announcements have any impact on the returns of firms listing on the JSE SRI Index. The event study methodology is utilised to estimate abnormal returns for the firms included in the Index. The results indicate insignificant average abnormal returns (AARs) for the years 2004, 2006, 2007, 2008 and 2009, suggesting no significant shareholder gains over the entire event window. However, the year 2005 is associated with positive and significant abnormal returns. Post announcement cumulative average abnormal returns (CAARs) are positive for the years 2005 and 2007. However, the year 2008 exhibited extreme swings in CAARs with a general declining trend in the latter part of the event window. These swings are attributed to the global financial crisis of 2008. Furthermore, the cumulative returns for the total sample show no clear outperformance of the SRI over the JSE All Share Index.

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