Socially responsible investing in the European Union’s capital markets

Grażyna Michalczuk, Urszula Konarzewska

DOI: http://dx.doi.org/10.12775/EiP.2020.049

Abstract


Motivation: The growing importance of the corporate social responsibility in the socio-economic sphere means that investors more and more often in their decision-making process include, alongside criteria of the effectiveness of invested capital, factors related to ecology, social development and corporate governance. This leads to diversification of the capital market in which, besides the traditional investing, socially responsible investing is becoming increasingly important.

Aim: The aim of the article is to identify the territorial diversification of socially responsible investments in the European Union’s capital markets in terms of value and investment strategies used, as well as to show the reasons for this diversity.

Results: The conducted analysis showed that more and more investors in the European Union base their decisions not only on financial parameters but also on social and environmental factors. However, this market is not homogenous. This applies to both the value and preferences regarding investments strategy. A significant impact on this diversity has the level of implementation of specific legislative solutions creating favourable conditions for the development of socially responsible investing.


Keywords


socially responsible investing; socially responsible investing strategies; capital market

Full Text:

PDF

References


Bednarowska, Z. (2015). Desk research: wykorzystanie potencjału danych zastanych w prowadzeniu badań marketingowych i społecznych. Marketing i Rynek, 7.

Brammer, S., Brooks, C., & Pavelin, S. (2006). Corporate social performance and stock returns: UK evidence from disaggregate measures. Financial Management, 35(3). doi:10.1111/j.1755-053X.2006.tb00149.x.

Brest, P., & Born, K. (2013). When can impact investing create real impact. Stanford Social Innovation, 11(4).

Derwall, J., Guenster, N., Bauer, R., & Koedijk, K. (2005). The eco-efficiency premium puzzle. Financial Analysts Journal, 61(2). doi:10.2469/faj.v61.n2.2716.

EFAMA. (2016). Report on responsible investments. Retrieved 19.03.2019 from https://www.efama.org.

European Commission. (2010). Communication from the Commission: Europe 2020: a strategy for smart, sustainable and inclusive growth (COM/2010/2020).

European Parliament resolution of 6 February 2013 on corporate social responsibility: accountable, transparent and responsible business behaviour and sustainable growth (OJ C 24, 22.1.2016).

Eurosif. (2010). European SRI study 2010. Retrieved 05.01.2019 from http://www.eurosif.org.

Eurosif. (2012). European SRI study 2012. Retrieved 05.01.2019 from http://www.eurosif.org.

Eurosif. (2014). European SRI study 2014. Retrieved 05.01.2019 from http://www.eurosif.org.

Eurosif. (2016). European SRI study 2016. Retrieved 05.01.2019 from http://www.eurosif.org.

Eurosif. (2018). European SRI study 2018. Retrieved 05.01.2019 from http://www.eurosif.org.

Fung, H., Law, S.A., & Yau, J. (2010). Socially responsible investments in a global environment. Cheltenham–Northampton: Edward Elgar.

Gov.uk. (2016). Social investment tax relief. Retrieved 19.03.2019 from https://www.gov.uk.

Gov.uk. (2019). Community investment tax relief. Retrieved 19.03.2019 from https://www.gov.uk.

GSIA. (2012). Global sustainable investment review 2012. Retrieved 05.01.2019 from http://gsiareview2012.gsi-alliance.org.

GSIA. (2014). Global sustainable investment review 2014. Retrieved 05.01.2019 from http://www.gsi-alliance.org.

GSIA. (2016). Global sustainable investment review 2016. Retrieved 05.01.2019 from http://www.gsi-alliance.org.

Hofferth, S.L. (2005). Secondary data analysis in family research. Journal of Marriage and Family, 67(4). doi:10.1111/j.1741-3737.2005.00182.x.

Iraya, C., & Musyoki, L.N. (2013). Performance of socially screened portfolio at the Nairobi Securities Exchange. International Journal of Humanities and Social Science, 3(6).

Kreibohm, E.M. (2016). The performance of socially responsible investment funds in Europe: an empirical analysis. Lohmar: Eul Verlag.

Nielsen, O. (2014). Responsible investments in the Swedish pension fund system: a case study of institutional investors. Uppsala: Uppsala University.

Renneboog, L., Ter Horst, J., & Zhang, C. (2010). Socially responsible investments funds. In G. Aras, & D. Crowther (Eds.), A handbook of corporate governance and social responsibility. Farnham: Gower Publishing.

Richardson, B.J. (2008). Socially responsible investment law: regulating the unseen polluters. New York: Oxford University Press.

Richardson, B.J. (2009). Keeping ethical investment ethical: regulatory issues for investing for sustainability. Journal of Business Ethics, 87(4). doi:10.1007/s10551-008-9958-y.

Schueth, S. (2003). Socially responsible investing in the United States. Journal of Business Ethics, 43(3). doi:10.1023/A:1022981828869.

Sethi, S.P. (2005). Investing in socially responsible companies is a must for public pension funds: because there is no better alternative. Journal of Business Ethics, 56(2). doi:10.1007/s10551-004-5455-0.

Sparkes, R. (2002). Socially responsible investment: a global revolution. Chichester: John Wiley & Sons.

Statman, M. (2000). Socially responsible mutual funds. Financial Analysts Journal, 56(3). doi:10.2469/faj.v56.n3.2358.

Statman, M. (2006). Socially responsible indexes: composition, performance and tracking error. Journal of Portfolio Management, 32(3). doi:10.3905/jpm.2006.628411.

Urwin, R., & Woods, C. (2009). Sustainable investment principles: models for institutional investors. Retrieved 18.01.2019 from http://uksif.org.

US SIF Foundation. (2016). Report on US sustainable, responsible and impact investing trends 2016. Retrieved 05.01.2019 from https://www.ussif.org.

Wagemans, F.A.J., van Koppen, C.S.A., & Mol, A.P.J. (2013). The effectiveness of socially responsible investment: a review. Journal of Integrative Environmental Sciences, 10(3–4). doi:10.1080/1943815X.2013.844169.

Waring, P, Burgess, J., & Lewer, J. (2008). Does socially responsible investment influence employment relations. In S. Marshall, R. Mitchel, & I. Ramsey (Eds.), Varieties of capitalism, corporate governance and employment systems. Carlton: Melbourne University Press.

Waring, P., & Edwards, T. (2008). Socially responsible investment: explaining its uneven development and human resource management consequences. Corporate Governance: An International Review, 16(3). doi:10.1111/j.1467-8683.2008.00676.x.

Williams, G. (2007). Some determinants of the socially responsible investment decision: a cross-country study. Journal of Behavioral Finance, 8(1). doi:10.1080/15427560709337016.

World Economic Forum. (2005). Mainstream responsible investment. Retrieved 05.01.2019 from https://community-wealth.org.








ISSN 1898-2255 (print)
ISSN 2392-1625 (online)

Partnerzy platformy czasopism