Renaming with purpose: Investor response and fund manager behaviour after fund ESG renaming

IF 2.8 2区经济学 Q2 BUSINESS, FINANCE

Journal of International Money and Finance Pub Date : 2025-01-03 DOI:10.1016/j.jimonfin.2024.103263

Kayshani Gibbon , Jeroen Derwall , Dirk Gerritsen , Kees Koedijk

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引用次数: 0

Abstract

Motivated by concerns that mutual funds' stated integration of environmental, social and governance (ESG) criteria in investing is cosmetic, we study the widespread phenomenon that mutual funds change their name to include ESG terms. Using a unique global sample of ESG-related name changes by 740 retail and 317 institutional share classes between July 2016 and September 2022, we investigate investors' response and fund managers' behaviour in terms of fund flows, portfolio-level ESG metrics and fees. Using difference-in-differences analyses and accounting for heterogeneous treatment effects, we provide mixed evidence on whether funds increase flows by renaming, although effects appear significant for funds domiciled in Europe. We subsequently document that fund managers do appear to improve the ESG performance, reduce exposure to controversial businesses, decrease the carbon intensity, and lower the overall ESG risks of their portfolios after ESG renaming. Renaming has no material impact on funds' expenses. The results alleviate concerns that funds use ESG-oriented name changes cosmetically and imply that they are renaming with purpose.

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来源期刊

Journal of International Money and Finance BUSINESS, FINANCE-

CiteScore

4.20

自引率

4.00%

发文量

141

期刊介绍： Since its launch in 1982, Journal of International Money and Finance has built up a solid reputation as a high quality scholarly journal devoted to theoretical and empirical research in the fields of international monetary economics, international finance, and the rapidly developing overlap area between the two. Researchers in these areas, and financial market professionals too, pay attention to the articles that the journal publishes. Authors published in the journal are in the forefront of scholarly research on exchange rate behaviour, foreign exchange options, international capital markets, international monetary and fiscal policy, international transmission and related questions.