Drivers of Socially Responsible Investing: A Case Study of Four Nordic Countries

This paper investigates the impact of negative screening on the investment universe as well as on financial performance. We come up with a novel identification process and as such depart from mainstream socially responsible investing literature by concentrating on individual firms' conduct and by studying a much wider range of issues. Firstly, we study the size and financial performance of fourteen potentially controversial issues: abortion, adult entertainment, alcohol, animal testing, contraceptives, controversial weapons, fur, gambling, genetic engineering, meat, nuclear power, pork, (embryonic) stem cells, and tobacco. We investigate an international sample of more than 1,600 stocks for more than twenty years. We then analyze the impact of applying negative screens to a market portfolio. Our findings suggest that the choice for negative screening strategies does matter for the size of the investment universe as well as for risk-adjusted return performance. Investing in controversial stocks in many cases results in additional risk-adjusted returns, whereas excluding them may reduce financial performance. These findings suggest that there are opportunity costs to negative screening.

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“…Kumar et al 2011;Kiymaz 2012;Durand et al 2013a;Salaber 2013;Scholtens and Sievänen 2013;Hood et al 2014).…”

Section: Introductionunclassified

The Opportunity Cost of Negative Screening in Socially Responsible Investing

2015

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“…Ringov & Zollo (2007) find that masculinity has a negative influence on the companies' social and environmental performances. Scholtens & Sievänen (2013) investigate the differences in the socially responsible investing (SRI) in Nordic countries and their study shows that Norway and Sweden, that have more femininity than Finland and Denmark, are both SRI pioneers. Hur et al (2016) and Jones et al (2017) find that female consumers have higher perceptions toward CSR than male consumers.…”

Section: Literature Review and Hypothesesmentioning

confidence: 99%

The Relationship between Femininity and Sustainability Reporting

Gallén

Peraita

2017

Corp Soc Responsibility Env

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Most research on corporate social responsibility (CSR) disclosure and the stakeholder engagement with sustainable development has focused on the internal factors of corporations, leaving aside the characteristics of the institutional, cultural and economic context of the country where corporations operate. The purpose of this study is to investigate the influence of femininity in the disclosure of sustainability information based on the Global Reporting Initiative (GRI) guidelines at a developed country context. We use three measures of the CSR information disclosure by country: the GRI reports per million of inhabitants, the GRI reports application level, and the percentage of GRI reports with external assurance. The results of this study show that countries with higher femininity orientation provide higher quantity of sustainability reports, but do not provide higher quality of sustainability reports.

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“…Since then, SRI has become an important investment tool in Scandinavia, and is by far the largest investment practice in Norway among the Nordic countries (Scholtens & Sievänen, 2013).…”

Section: Social Responsible Investment (Sri)mentioning

confidence: 99%

Attitudes towards ethical pension management among Norwegians

Ditlev-Simonsen

Wenstøp

2016

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SammendragI denne studien har vi kartlagt nordmenns holdninger til etisk forvaltning av pensjonsfond som kan innebaere redusert pensjon. Vi studerer folks holdning til etikk angående eget pensjonsfond samt deres forestillinger hvilke holdninger andre har.Fokuset er på hvordan politisk partipreferanse og tilhørende verdier påvirke holdninger. Vi analyserer dataene med tre velkjente verdisystemer beskrevet av henholdsvis Inglehart, Welzel og Hellevik.Vi finner at 40 % sier de ville velge etisk investering selv om det betyr at deres egen pensjon vil bli redusert, mens 32 % sier nei. Det er uvisst hvor de 28 % som sier de ikke vet, vil ende opp, men dette kan tolkes som en generell positiv holdning i befolkningen til etisk pensjonsforvaltning.Holdningene er avhengig av verdier, og Helleviks verdisystem er en litt bedre indikator enn de andre. Funnene viser at viljen til å investere etisk øker med idealisme, venstreorientering og utdanningsnivå, og synker med inntekt. De samme verdiene er ikke relatert til folks oppfatning av hvordan de tror andre ville valgt når det gjelder villighet til etisk pensjonsforvaltning. Nøkkelord: Social Responsible Investment (SRI), pensjon fond, verdisystemer, holdninger, World Values Survey (WVS), Inglehart, Welzel, Hellevik, Petroleumsfondet utland AbstractWe have surveyed the attitudes of Norwegians toward ethical pension management that carries an opportunity cost. We study attitude regarding own pension fund as well as belief about other people's attitudes. Our findings show that 40% of the respondents claim they would choose ethical investment, even though it implies reduced pension. 28% would not choose ethical investment. It is unclear how those who say they do not know would end up, still the findings can be interpreted as a general positive attitude among people to ethical pension management.Attitudes depend on values, and Hellevik's value system is a slightly better predictor than the two other value systems. The findings show that willingness to invest ethically increases with idealism, leftist position and education level, and sinks with income. However, the values are not related to people's perception of other people's attitudes.

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Drivers of Socially Responsible Investing: A Case Study of Four Nordic Countries

Cited by 113 publications

References 49 publications

The Opportunity Cost of Negative Screening in Socially Responsible Investing

The Opportunity Cost of Negative Screening in Socially Responsible Investing

The Relationship between Femininity and Sustainability Reporting

Attitudes towards ethical pension management among Norwegians

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