{"title":"One size does not fit all: Responsible investor motivation and investment performance","authors":"Bert Scholtens, Fabian Willard","doi":"10.1002/csr.2905","DOIUrl":null,"url":null,"abstract":"Most research in socially responsible investing is about how it influences financial performance. Hardly any study investigates how it affects responsibility. We investigate how different motives of responsible investors affect portfolio design and financial and nonfinancial performance of investments. We study financial, deontological, consequentialist, and expressive motivated responsible investors. The first seek to achieve financial outperformance by relying on environmental, social, and governance (ESG) information. The second avoid investing in controversial issues. The third seek to influence the most sustainable firms. The fourth try to enhance their own social identity by investing responsibly. We find that the specific motivation for socially responsible investing does not significantly affect financial performance. However, the motivation does have a substantial influence on the responsibility score of the portfolio. In particular, deontological portfolios underperform the universe regarding responsibility performance. This might reflect the origin of responsibility scoring where controversial firms usually invest more in responsibility than less controversial ones. The other portfolios all outperform the market. This has important lessons for responsible investment funds: they will need to find out about the motives of their investors to modify portfolio design when investing responsibly. “One size for all” is no option when targeting responsible investors.","PeriodicalId":48334,"journal":{"name":"Corporate Social Responsibility and Environmental Management","volume":null,"pages":null},"PeriodicalIF":8.3000,"publicationDate":"2024-07-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Corporate Social Responsibility and Environmental Management","FirstCategoryId":"91","ListUrlMain":"https://doi.org/10.1002/csr.2905","RegionNum":2,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"BUSINESS","Score":null,"Total":0}
引用次数: 0
Abstract
Most research in socially responsible investing is about how it influences financial performance. Hardly any study investigates how it affects responsibility. We investigate how different motives of responsible investors affect portfolio design and financial and nonfinancial performance of investments. We study financial, deontological, consequentialist, and expressive motivated responsible investors. The first seek to achieve financial outperformance by relying on environmental, social, and governance (ESG) information. The second avoid investing in controversial issues. The third seek to influence the most sustainable firms. The fourth try to enhance their own social identity by investing responsibly. We find that the specific motivation for socially responsible investing does not significantly affect financial performance. However, the motivation does have a substantial influence on the responsibility score of the portfolio. In particular, deontological portfolios underperform the universe regarding responsibility performance. This might reflect the origin of responsibility scoring where controversial firms usually invest more in responsibility than less controversial ones. The other portfolios all outperform the market. This has important lessons for responsible investment funds: they will need to find out about the motives of their investors to modify portfolio design when investing responsibly. “One size for all” is no option when targeting responsible investors.
期刊介绍:
Corporate Social Responsibility and Environmental Management is a journal that publishes both theoretical and practical contributions related to the social and environmental responsibilities of businesses in the context of sustainable development. It covers a wide range of topics, including tools and practices associated with these responsibilities, case studies, and cross-country surveys of best practices. The journal aims to help organizations improve their performance and accountability in these areas.
The main focus of the journal is on research and practical advice for the development and assessment of social responsibility and environmental tools. It also features practical case studies and evaluates the strengths and weaknesses of different approaches to sustainability. The journal encourages the discussion and debate of sustainability issues and closely monitors the demands of various stakeholder groups. Corporate Social Responsibility and Environmental Management is a refereed journal, meaning that all contributions undergo a rigorous review process. It seeks high-quality contributions that appeal to a diverse audience from various disciplines.