The Market for Socially Responsible Investments

2020 ◽  
pp. 171-188
Author(s):  
Mark Anthony Camilleri
Keyword(s):  
Financial Markets ◽  
Positive Impact ◽  
Socially Responsible Investing ◽  
Future Research ◽  
Socially Responsible ◽  
Responsible Investing ◽  
Socially Responsible Investments ◽  
The Subject ◽  
Public Organisations ◽  
Sustainable Investments

This chapter explains how socially responsible investing (SRI) has evolved in the last few decades and sheds light on its latest developments. It describes different forms of SRI in the financial markets and deliberates on the rationale for the utilisation of positive and negative screenings of listed businesses and public organisations. It also presents key theoretical underpinnings on the subject and reports that the market for the responsible investments has recently led to an increase in contractors, non-governmental organisations (NGOs), and research firms who are involved in the scrutinisation of the enterprises' environmental, social, and governance (ESG) credentials. This contribution raises awareness on the screenings of positive impact and sustainable investments. It puts forward future research avenues in this promising field of study.

The market for socially responsible investing: a review of the developments

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Mark Anthony Camilleri
Keyword(s):  
Financial Markets ◽  
Financial Services ◽  
Positive Impact ◽  
Socially Responsible Investing ◽  
Future Research ◽  
Socially Responsible ◽  
Content Type ◽  
Responsible Investing ◽  
Non Governmental Organizations ◽  
Sustainable Investments

Purpose This study aims to explain how socially responsible investing (SRI) has evolved in the past few decades and sheds light on its latest developments. It describes different forms of SRI in the financial markets, and deliberates on the rationale for the utilization of positive and negative screenings of listed businesses and public organizations. Design/methodology/approach A comprehensive literature review suggests that the providers of financial capital are increasingly allocating funds toward positive impact and sustainable investments. Therefore, this descriptive paper provides a factual summary of the proliferation of SRI products in financial markets. Afterwards, it presents the opportunities and challenges facing the stakeholders of SRI. Findings This research presents a historic overview on the growth of SRI products in the financial services industry. It clarifies that the market for responsible investing has recently led to an increase in a number of stakeholders, including contractors, non-governmental organizations and research firms who are involved in the scrutinization of the businesses’ environmental, social and governance (ESG) behaviors. Originality/value This discursive contribution raises awareness on the screenings of positive impact and sustainable investments. The researcher contends that today’s socially responsible investors are increasingly analyzing the businesses’ non-financial performance, including their ESG credentials. In conclusion, this paper puts forward future research avenues in this promising field of study.

scholarly journals TRENDS IN THE DEVELOPMENT OF SOCIALLY RESPONSIBLE INVESTING IN THE WORLD: THEORETICAL AND PRACTICAL ASPECTS

2020 ◽  
pp. 74-83
Author(s):  
Maryna Dielini
Keyword(s):  
Statistical Study ◽  
Socially Responsible Investing ◽  
Scientific Article ◽  
Socially Responsible ◽  
Responsible Investment ◽  
Responsible Investing ◽  
Historical Factors ◽  
Socially Responsible Investments ◽  
The World ◽  
The Subject

The subject of this scientific article is the theoretical study of socially responsible investment (SRI) and development in the world and countries of Europe. The purpose of the research is to study the essence of socially responsible investing, its strategies and to analyze statistically the development of socially responsible investing in the world and in Europe in particular. Research methods. The methods of synthesis, analysis, comparison, generalization, statistical data processing, graphical and tabular methods of presentation of scientific results were used. The result of the work is a theoretical and statistical study of the subject of the article. The essence of socially responsible investing is defined as investing in socially responsible entrepreneurships with the purpose of profit. Historical factors of socially responsible investing have been investigated, among which the religious aspect and the increasing importance of human values have been highlighted. Have been described main strategies that investors use in decision-making process about financing companies or projects, outlined their differences and purposes. On the basis of abovementioned, a statistical study was conducted to analyze the overall status of the SRI in the world, what strategies are most represented and to explore more deeply the state of development of SRI in Europe, as the region with the highest volume of SRI. The results of the research can be used by companies that search an outside investor or, conversely, invest in other businesses to understand the request of today’s business society. Taking into account the world experience will allow to increase the company's own image and a positive effect on the society and the environment. Conclusion. Socially responsible investments are gaining ground in the world, as this is required by the global community. Entrepreneurs understand the importance of earning socially responsible profits, which is generated by investing in responsible enterprises and projects.

scholarly journals 35 years of socially responsible investing (SRI) research: General trends over time

2012 ◽  
Vol 43 (4) ◽  
pp. 1-16 ◽  
Author(s):  
S. Viviers ◽  
N. S. Eccles
Keyword(s):  
Quantitative Research ◽  
Academic Research ◽  
Legal Aspects ◽  
Socially Responsible Investing ◽  
Future Research ◽  
Research Approach ◽  
Socially Responsible ◽  
Ethical Egoism ◽  
Responsible Investing ◽  
Research Themes

This article describes 35 years of academic research into investment practices that in some way integrate a consideration of environmental, social and corporate governance issues. A review of 190 academic papers was undertaken to identify trends in five domains, namely ‘Primary Name’, ‘Research Themes’, ‘Ethical Foundations’, ‘Research Approach’ and ‘SRI Strategies’. The evidence reveals that more than half the researchers refer to such investment practices as Socially Responsible Investing (SRI) and for this reason the name is used in this review as a generic term for the genre. A myriad of other names were also identified. In terms of research themes, one particularly dominant theme was that of financial performance, which was often discussed in relation to fiduciary responsibility and legal aspects. Although the primary ethical foundation was not always directly observable, the majority of papers implied utilitarianism or ‘the greatest good for the greatest number’. Increased mention of ethical egoism (self-interest) is observed in later periods. An equal split between qualitative and quantitative research methodologies was noted, with a qualitative approach being more favoured in recent years. Three SRI strategies have dominated academic discussions over the past 35 years, namely negative screening, positive screening and shareholder activism. Gaps in the literature have been identified and suggestions for future research made.

Accounting challenges for sustainability and innovations

2021 ◽  
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Research And Development ◽  
Financial Reporting ◽  
Socially Responsible Investing ◽  
Integrated Reporting ◽  
Socially Responsible ◽  
Responsible Investing ◽  
Socially Responsible Investments ◽  
Corporate Social

The aim of this e-book is to present the most important aspects related to sustainability, corporate social responsibility and innovation from an accounting perspective. The book contains parts that deal with accounting aspects of sustainability and innovations. The book consists of ten chapters devoted to relevant and topical issues of sustainability and innovations. Chapter 1 Sustainability and Corporate Social Responsibility in Accounting is an introduction to further considerations and deals with the essence of sustainable development, corporate social responsibility and their recognition in accounting. Chapter 2 Social Responsibility Reporting Standards presents the most important reporting guidance such as GRI, OECD, United Nations Global Compact, International Organization for Standardization. Chapter 3 Narrative reporting focuses on descriptions and explanations in accounting reports. The chapter presents the links between accounting and language, the development of accounting narratives and the factors determining the use of narratives. Chapter 4 Integrated reporting discusses the motivations, objectives and the process of preparing an integrated report. Integrated reporting can prove to be an effective tool for businesses looking to shift their reporting focus from annual financial performance to long-term shareholder value creation. Chapter 5 Non-financial reporting in selected European countries presents the experience of Croatia, the Czech Republic and Poland in the field of preparing non-financial reports. A significant contribution to promoting the importance of sustainability reporting was made by the Non-Financial Reporting Directive (2014/95/EU). Chapter 6, Socially Responsible Investments discusses the essence of socially responsible investing and socially responsible investment. Socially responsible investing (SRI) is a decision making process concerning the allocation of free financial resources, where the investor aims at maximization of profit and minimization of risk on one part and includes the socio-ethical and environmental-ecological considerations on the other. Chapter 7 External costs – accounting perspective describes costs connected with using goods such as air, soil, water, silence or the aesthetics of the surroundings. One of the biggest problems for accounting in the future will be measuring the volume of using these goods or measuring the size of reduction in the quality of public goods suffered and assigning the decrease to particular companies. Chapter 8 Derivatives in accounting is devoted to financial instruments and presents two different approaches to accounting of derivatives: general model and hedge accounting. Derivatives are used to protect the enterprise against financial risk related to changes in prices on the markets, changes in the exchange rate or changes in interest rates, as well as for commercial purposes. Chapter 9 Costs of Research and Development shows the company's activity in the field of research and development and the related costs. R&D constitute an increasingly important element of the functioning of enterprises. Chapter 10 Cryptoassets – Nature, Valuation and Disclosures in Accounting focuses on cryptocurrencies (e.g. Bitcoin, Ethereum etc.) and digital tokens which are specific rights or values representatives. As a result of the transformation on the financial market, we are currently dealing with cryptoassets, which are a creation of blockchain technologies and the changing habits of the digital society. One of areas that there are a lot of doubts regarding these new technological solutions is accounting.

Socially responsible investing: a review of the critical issues

2015 ◽  
Vol 41 (11) ◽  
pp. 1176-1201 ◽  
Author(s):  
Joan Junkus ◽  
Thomas D. Berry
Keyword(s):  
Mutual Funds ◽  
Firm Value ◽  
Socially Responsible Investing ◽  
Model Specification ◽  
Future Research ◽  
Socially Responsible ◽  
Content Type ◽  
Responsible Investment ◽  
Definitive Answer ◽  
Responsible Investing

Purpose – The purpose of this paper is to provide a review of the most recent work in major finance journals on socially responsible investment (SRI). While SRI involves individual investors, firms, and investment managers, the authors concentrate primarily on the investment view. Design/methodology/approach – The authors briefly review the development of socially responsible investing (SRI) and the theoretical issues related to SRI and investment choice. This is followed by a review of the empirical results concerning firm value. The question of whether SR mutual funds and SR indexes differ in performance or other characteristics from their conventional counterparts is discussed next, and lastly the authors present suggestions for future research directions. Findings – Despite the large and extensive amount of empirical research published on SRI in recent years, the authors find no definitive answer to the question of SR actions for either the firm or the investor. For firms, evidence linking corporate social responsibility (CSR) rankings with higher value is mixed, and depends on the type of CSR behavior studied as well as the measures of firm performance used. The performance of SR mutual funds and indexes generally are not significantly different from conventional funds or indexes, but again these results are also highly dependent on model specification, time period, benchmark, and other characteristics of the study. Practical implications – The value of SR investing has not been definitely proved. This means, however, that there is room for further on this important topic. Originality/value – This paper synthesizes and presents the most recent research on SRI from a wide variety of refereed sources.

Approaches to shaping portfolio strategies based on the socially responsible investing concept

2021 ◽  
Vol 14 (4) ◽  
pp. 376-392
Author(s):  
Natal'ya A. KHUTOROVA ◽  
Nikita A. NAZIN
Keyword(s):  
Financial Markets ◽  
Graphical Analysis ◽  
Socially Responsible Investing ◽  
Socially Responsible ◽  
The Sustainable Development ◽  
Analysis Techniques ◽  
Responsible Investing ◽  
Portfolio Strategies ◽  
General Scientific ◽  
Russian Stock Market

Subject. The article considers formulation of portfolio strategies that rest on the concept of socially responsible investing. Objectives. The purpose of this study is to analyze approaches to shaping the portfolio strategies based on the principle of socially responsible investing in the Russian stock market. Methods. The study employs general scientific research methods; logical, comparative, and statistical analyses; graphical analysis techniques. Results. We formulated and tested two strategies of socially responsible investing, i.e. Short ESG Ranking of Russian Companies and Long ESG Ranking of Russian Companies. The testing demonstrated below market return for the entire period. Thus, the strategies cannot be considered effective. To increase profitability, we proposed to optimize the strategies by including ESG-related debt instruments. Green bonds enabled to significantly increase profitability and outstrip OFZ yields. Despite the fact that according to the testing, the effect of both strategies turned out to be worse than IMOEX and MOEXBC indices, the strategies can be considered as relevant and acceptable for portfolio simulation. Conclusions. Under the current conditions in the financial markets caused by serious shocks during the coronavirus pandemic and significant changes in the monetary policy of the Bank of Russia, the proposed strategies can be used by socially responsible institutional investors to shape investment policy and by individuals to manage funds in individual investment accounts. New bonds of Russian issuers in the sustainable development sector of the Moscow Exchange expanded the list of ESG instruments. They can serve as an effective optimization tool.

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