scholarly journals The Impact of ESG Factors on Asset Returns: Empirical Research

2021 ◽  
Vol 25 (4) ◽  
pp. 82-97
Author(s):  
O. V. Efimova ◽  
M. A. Volkov ◽  
D. A. Koroleva
Keyword(s):  
Quantitative Methods ◽  
Investment Decision ◽  
Investment Strategies ◽  
Scientific Publications ◽  
Responsible Investment ◽  
The Sustainable Development ◽  
Investment Decision Making ◽  
Investment Portfolios ◽  
The Impact ◽  
The Relationship

The subject of the research is the assessment of Investment decision-making efficiency considering the sustainable development requirements. The article aims to identify the relationship between environmental, social and governance (ESG) performance and market returns for investors and the reasons for it. The relevance of the paper is determined by the need to develop research in the field of ESG integration and evaluation of the portfolio investment effectiveness in the context of responsible investment practices popularity. Scientific novelty: the study develops the theory of ESG integration and allows the authors to conclude that ESG commitment is a driver of market profitability for investors. The authors apply methods such as theoretical analysis of scientific publications (analysis, synthesis, generalisation) and quantitative methods, including statistical data analysis, regression analysis, financial modelling. The research base is scientific works of domestic and foreign authors, analytical reports of rating agencies, ESG funds, historical stock market data on companies analysed in the course of this study. All the information used in this study is publicly available or provided by the Bloomberg database. In the course of the study, authors form model portfolios of ESG-oriented and ESG-neutral companies shares and perform a comparative analysis of their fundamental indicators and financial returns. The authors conclude that the portfolio of ESG-oriented companies demonstrates profitability no lower than the portfolio of ESG-neutral companies, considering the risks. At the same time, the values of the fundamental indicators of ESG-oriented companies are inferior to the values of ESG-neutral companies. The relationship between the degree of a company’s ESG compliance and its investment attractiveness is due, among other things, to non-financial value drivers. The authors recommend integrating ESG into the analysis of investment portfolios, significant for the development of investment strategies.

Strengthening impact integrity in investment decision-making for sustainable development

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Fara Azmat ◽  
Ameeta Jain ◽  
Fabienne Michaux
Keyword(s):  
Decision Making ◽  
Sustainable Development ◽  
Management Practices ◽  
Investment Decision ◽  
Investment Strategies ◽  
Content Type ◽  
Responsible Investment ◽  
The Sustainable Development ◽  
Investment Decision Making ◽  
Development Outcomes

Purpose This paper aims to focus on impact integrity in investment decision-making – an under-researched yet important topic – as a means for optimising investor contributions to sustainable development outcomes, including achieving the sustainable development goals (SDGs). Design/methodology/approach This conceptual paper adopts a two-step approach. First, this paper reviews existing “responsible” investment strategies and products used in practice and highlight their shortcomings in terms of optimising sustainable development outcomes. Second, drawing from the minimal standards theory, this study explores how emerging impact management practices may strengthen impact integrity in investment decision-making and mitigate shortcomings in existing “responsible” investment approaches to increase their contribution to sustainable development outcomes. Findings Current “responsible” investment approaches often do not optimise sustainable development outcomes and may facilitate “impact washing”. The theoretically grounded framework demonstrates standardised impact management practices based on a bounded flexibility approach – adaptable to different contexts within limits and assessed by skilled analysts – along with incorporating shared language and conventions supported by appropriate accountability mechanisms that can be used to mitigate shortcomings in current “responsible” investment approaches. The authors further propose accountability mechanisms to systematically involve stakeholders (including rightsholders) in decisions that impact them with effective grievance and reparation mechanisms. Such an approach, the authors argue will strengthen impact integrity and the capacity of investments to optimise contributions to sustainable development outcomes. Practical implications The findings have implications for the ability of investment markets to optimise their contributions to sustainable development and the SDGs. Social implications By highlighting shortcomings in current “responsible” investment approaches and focussing on strengthening impact integrity in investment decision-making through standardised impact management practices, the findings enhance the capacity of investment markets to contribute positively to sustainable development and the SDGs. Originality/value Despite its importance, impact integrity in investment decision-making is severely under-researched with little academic attention. This paper fills this void.

The impact of regulatory risks of ESG integration on the sustainable development of power companies

2021 ◽  
Vol 17 (4) ◽  
pp. 624-648
Author(s):  
Irina V. ZENKINA
Keyword(s):  
Decision Making ◽  
Sustainable Development ◽  
Investment Decision ◽  
Investment Decisions ◽  
Decision Making Process ◽  
Responsible Investment ◽  
The Sustainable Development ◽  
Investment Decision Making ◽  
Development Concept ◽  
The Impact

Subject. The article focuses on modern trends in the integration of sustainable development drivers into the substantiation of investment decisions, related regulatory risks and their impact on the sustainable development of companies in the energy and fuel sector. Objectives. I study the global advancement of responsible investment through the sustainable development concept and determine how regulatory risks of the integration of environmental responsibility factors, social responsibility and administrative efficiency into the investment decision-making process on the sustainable development of power companies. Methods. The study relies upon the analysis and synthesis, detailed elaboration and generalization, comparison, abstraction, analogy, index method, systems, strategic and risk-based approaches. Results. The article demonstrates how the sustainable development concept currently evolves and is getting updated. I found the unstoppable evolution of the regulatory and legislative framework, which encourages sustainability projects, and business practice including ESG factors into the investment decision-making process. The article substantiates the role of the responsible investment mechanism and the impact of regulatory risks of ESG integration on the sustainable development of power companies. I show what results can be achieved by analyzing ESG performance of an oil and gas corporation via Thomson Reuters, which helps to assess ESG risks for the company, its investors, and other key stakeholders. Conclusions and Relevance. The integration of ESG factors into the investment decision-making process ensures the adequate awareness of investors, helps mitigate ESG risks, increases the reasonableness of decisions investors make, and raises the quality and completeness of ESG data disclosure in corporate reporting. Regulatory risks of the ESG integration stem from companies’ breaches in effective regulations and rules on ESG performance and result in negative legislative and economic consequences. Therefore, I make suggestions on the analysis of sustainability factors and indicators, which pursues the mitigation of ESG risks of power companies and their investors, and ensures the efficiency of investment decisions.

scholarly journals The Relationship between Industrial Heritage, Wine Tourism, and Sustainability: A Case of Local Community Perspective

2020 ◽  
Vol 12 (18) ◽  
pp. 7453 ◽  
Author(s):  
María Andrade-Suárez ◽  
Iria Caamaño-Franco
Keyword(s):  
Quantitative Methods ◽  
Local Community ◽  
Wine Industry ◽  
Primary Data ◽  
The Sustainable Development ◽  
Wine Tourism ◽  
Local Perception ◽  
General Terms ◽  
The Impact ◽  
The Relationship

Our research addresses wine tourism as a means of enhancing the heritage and industrial memory of wine. Specifically, it considers winery tours as a form of industrial tourism capable of boosting the sustainable development of winemaking territories. This article explores the significance and perception of wine tourism from the perspective of the local community by examining a specific case: The Port Wine Cellars in Vila Nova de Gaia (Portugal), where tourism and the wine industry are undergoing a greening process, sharing both cultural and commercial ties. The originality of this article lies in the empirical part of the research, which, using quantitative methods based on questionnaires, provides primary data regarding the relationship between sustainability and industrial wine tourism from the perspective of local residents, key agents in the promotion and success of the destination. In general terms, the results statistics obtained through a cluster analysis show that local perception of the impact of wine tourism in Gaia is favorable, and it is considered an element with the capacity to revitalize the economy and also enhance the city’s image. It is also seen as a sustainable option, attributable mainly to economic, cultural, and governance considerations.

scholarly journals The Effects of Irreversibility and Uncertainty on Business Investments: A New View of Investment

2014 ◽  
Vol 5 (3) ◽  
pp. 7-20
Author(s):  
Katarína Belanová
Keyword(s):  
Empirical Analysis ◽  
Investment Decision ◽  
Firm Level ◽  
Factors Affecting ◽  
Real Options Approach ◽  
Investment Decision Making ◽  
Level Data ◽  
The Impact ◽  
The Relationship ◽  
The Empirical Analysis

This article presents a survey of recent theoretical, as well as empirical, contributions concerning business investments, which help to explain the investment decision making of companies. These contributions emphasize the relevance of idiosyncratic factors affecting investment decisions such as the degree of irreversibility and uncertainty, interactions between these factors may generate an opportunity cost equivalent to the exercise of an option and so they add an important dimension to the neoclassical theory of investment (also called standard or orthodox theory of investment). This theory has not recognized the important qualitative and quantitative implications of this interaction, what can explain some of its failures. We investigate the irreversibility of investments and the impact this has on the nature of the relationship between investment and uncertainty in the way of empirical analysis. The empirical analysis uses firm – level data and is based on a survey of 53 automotive suppliers, which was carried out during the year 2011. We find supportive evidence for the fact that uncertainty is negatively associated with planned investments of the companies surveyed, which remains true also in the presence of irreversibility. At the end we demonstrate the core of the real options approach in a form of a practical example.

ESG Integration Treats Ethics as Risk, but Whose Ethics and Whose Risk? Responsible Investment in the Context of Precarity and Risk-Shifting

2019 ◽  
Vol 46 (4-5) ◽  
pp. 573-587 ◽  
Author(s):  
Claire Parfitt
Keyword(s):  
Decision Making ◽  
Risk Management ◽  
Political Action ◽  
Investment Decision ◽  
Risk Shifting ◽  
Responsible Investment ◽  
Investment Decision Making ◽  
The Social ◽  
The Relationship ◽  
Opening Up

This article contributes to scholarly debates about the relationship between precarity and financialization by applying Randy Martin’s concept of the social derivative to the phenomenon of responsible investment. It explores how responsible investment emerges as an avenue for political action in the context of disintermediated governance. Analyzing one strategy of responsible investment, the integration of environmental, social, and governance (ESG) risks into investment decision making, through the frame of the social derivative, the article argues that a derivative logic of ethics underpins ESG risk management. This complicates contemporary understandings of precarity as risk-shifting, because ESG integration creates connections between unlikely parties, opening up new forms and directions for political contest through finance. However, the article reveals that the contingent and profit-driven ethics on which ESG risk management is based establishes a narrow foundation on which these contests take place.

scholarly journals PENGARUH INTERNET FINANCIAL REPORTING, TINGKAT PENGUNGKAPAN INFORMASI BERBASIS WEBSITE, DAN JUMLAH SAHAM BEREDAR TERHADAP FREKUENSI PERDAGANGAN SAHAM

2021 ◽  
Vol 4 (2) ◽  
pp. 447-462
Author(s):  
Meidy Tiara Nur Sausan ◽  
Erna Sulistyowati
Keyword(s):  
Financial Reporting ◽  
Stock Prices ◽  
Information Disclosure ◽  
Quantitative Methods ◽  
Investment Decision ◽  
Secondary Data ◽  
Stock Trading ◽  
Trading Frequency ◽  
Investment Decision Making ◽  
The Impact

The objectives of this study are: (1) to prove, test, empirically and analyze the impact of Internet Financial Reporting on Stock Trading Frequency, (2) to prove, test, empirically and analyze the impact of the Website-Based Information Disclosure Level on Stock Trading Frequency, (3) Testing, proving, by empirical means and analyzing the impact of the Number of Outstanding Shares on the Trading Frequency of Shares. This study uses quantitative methods using secondary data taken from the company's website and the IDX through www.idx.co.id in 2016-2018. In this study, we will use data analysis techniques with multiple linear regression with the help of SmartPLS 3.29. The results of this study show that (1) "Internet Financial Reporting" has no effect on Stock Trading Frequency, (2) Website-Based Information Disclosure has no effect on Stock Trading Frequency, (3) Number of Outstanding Shares has no effect on Stock Trading Frequency. The implications of this research are paying attention to financial information in the company that is listed through the website then investors can predict future financial performance and prospects and can make decisions related to investment decision making, by uploading and updating information owned by the company can provide education to the public. users and prosper the company. The high and low level of disclosure of company website information will have a small impact on the impact of disclosure on investor decisions. In addition, taking into account factors other than the number of outstanding shares, such as fundamental factors and stock prices, can attract investors to invest in the company, because basically investors in buying shares must choose liquid shares.

scholarly journals Impact of Heuristics on Investment Decisions: The Moderating Role of Locus of Control

2020 ◽  
Vol 5 (1) ◽  
pp. 1-14
Author(s):  
Jeetendra Dangol ◽  
Rashmita Manandhar
Keyword(s):  
Decision Making ◽  
Locus Of Control ◽  
Investment Decision ◽  
Investment Decisions ◽  
Sampling Procedure ◽  
Moderating Effect ◽  
Moderation Effect ◽  
Investment Decision Making ◽  
Overconfidence Bias ◽  
The Impact

This paper aims to assess the impact of heuristics on the investment decision by analysing the effect of four heuristic biases, i.e., representativeness, availability, anchoring and adjustment, and overconfidence bias on rationality of Nepalese investor's investment decision-making and also examines the moderating effect of the internal locus of control in between. The study used 391 respondents based on a convenient sampling procedure, and structured questionnaire survey. The study result indicates that there is a significant relationship between irrationality in investment decision-making and all four heuristic biases. In addition, the study also concludes that locus of control has significant moderating effect in the relationship between investment decisions and three heuristic biases, i.e., availability, representative and anchoring bias. However, the study documents no moderation effect in case of relationship with overconfidence bias.

scholarly journals The Relationship between Accounting Information Systems and Making Investment Decisions in the Industrial Companies Listed in the Saudi Stock Market

2017 ◽  
Vol 10 (6) ◽  
pp. 199 ◽  
Author(s):  
Qasim Alawaqleh ◽  
Mahmoud Al-Sohaimat
Keyword(s):  
Decision Making ◽  
Information Systems ◽  
Investment Decision ◽  
Accounting Information ◽  
Kingdom Of Saudi Arabia ◽  
Policy Makers ◽  
Accounting Information Systems ◽  
Industrial Companies ◽  
Investment Decision Making ◽  
The Relationship

The study aimed to measure the relationship between the investment decision-making in the industrial companies listed in the Saudi Stock Market with the (IVs) characteristics of the accounting information systems (appropriateness and reliability, comparability and understanding), and renovation and maintenance of the hardware and software. The problem in the Kingdom of Saudi Arabia is that the government depends on oil revenues more than on attracting investments, therefore, the importance of this study is constituted by the provision of critical recommendations to policy makers in the Kingdom of Saudi Arabia in order to overcome this issue and improve the investments. In order to achieve the objectives of this study, questionnaires were administered to 194 people representing the study population; a multiple regression (standard regression) was also used to test the study hypotheses. In general, all variables were positively significantly related with the investment decision-making.The findings of this study also showed that the independent variables explained more than 65% of the variance in investment decision-making. The Saudi government and policy makers should issue new regulations to increase the interest in accounting information systems in order to attract the investment. In relation to the practical and theoretical contribution, this study used new variables in the new model, such as renovation and maintenance of the hardware and software. Furthermore, practical contribution will help policy makers and the Saudi government to advance in this area and implement new policies for investors in order to protect the economy and the society stability due to the war in Yemen and Syria.

scholarly journals Research on Power Grid Investment Assistant Decision Model Adapting to Power Reform Situation

2020 ◽  
Vol 218 ◽  
pp. 02026
Author(s):  
Yidi Wan ◽  
Wei Xie ◽  
Haihong Du ◽  
Wenming Pan ◽  
Jianqing Li ◽  
...  
Keyword(s):  
Decision Making ◽  
Investment Decision ◽  
Power Grid ◽  
Scale Structure ◽  
Leading Role ◽  
Investment Decision Making ◽  
Investment Structure ◽  
External Management ◽  
Power Grid Planning ◽  
The Impact

in order to thoroughly implement the new energy security strategy of “four revolutions and one cooperation”, meet the requirements of power grid planning and management of energy administration, realize the strategic objectives of State Grid Corporation of China, actively respond to the severe external economic situation, alleviate the impact of policy-based price reduction, and improve the performance of internal investment management, the company needs scientific front-end decision-making, improve the efficiency of investment decision-making, scientifically determine the investment scale, structure and timing, and play a strategic leading role in investment decision-making. Through the analysis of internal and external management requirements, this paper constructs an auxiliary decision-making model of power grid investment to support the determination of investment scale, structure and time sequence, to realize the reasonable investment scale calculation of provincial companies, the calculation of investment structure of different voltage levels and the optimization of project delivery under the condition of given investment scale, which comprehensively considers the external supervision, economic development and internal management objectives, so as to assist the prior investment decision-making, improve the input-output efficiency, effectively improve the Advisory decision-making ability of investment data, and meet the company’s investment decision-making needs.

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