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Socially responsible investments represent the heart of a sustainable and inclusive economy. The goals set by the regulatory framework have encouraged the integration of responsible concerns into the corporate business strategy. In this paper, we present an operation research design under a risk management perspective that adjusts the portfolio selection problem for the ethical values of investors. We focus on the firms of the Euro Stoxx 50 during the years 2007–2019 and cluster the companies according to the Environmental Score (E). For each cluster, we build a portfolio that minimizes the Conditional Value-at-Risk (CVaR) introducing the constraint on the E into the optimization problem. We compute the Shapley Value for each portfolio using the minimized CVaR and the optimized E as the characteristic functions to yield, respectively, the contribution of the portfolios to the public welfare in terms of the exposure to the tail market risk and the required environmental commitment to mitigate it. The cluster analysis shows that the efforts of the firms to embrace environmental concerns are paid off with generally lower contribution to the tail market risk. From the two characterizations of the Shapley Value, the computation of well-known measures of financial performance (Sharpe, Sortino, and Calmar ratios) reveals that optimal portfolio choices should prioritize the environmental commitment of the companies. [ABSTRACT FROM AUTHOR]

Purpose: The study aims to investigate the risk transmission from COVID-19 to global agriculture, energy, natural resources/mining and environmentally/socially responsible investments. Additionally, it explores the connectedness of global energy indices with global agriculture, natural resources/mining and environmentally/socially responsible investments. The study develops a new COVID-19-based Global Fear Index (GFI) to achieve the objectives, thus contributing to the prevailing literature. Design/methodology/approach: The data of Global indices are selected from January 2020 to December 2021. The study uses multivariate BEKK-GARCH and TVP-VAR models to explore COVID-19 risk transmission and connectedness between global indices. Findings: Significant shock and volatility transmissions from COVID-19 to all global indices are observed. Results show that global agriculture, natural resource/mining markets and environmentally and socially responsible investments are safe havens during COVID-19. Furthermore, these global investment choices are barely connected with global energy indices. Practical implications: Portfolio managers and investors should invest in global indices to gauge the risk-adjusted return during the pandemic and upcoming health-related risks. Investors in energy sectors are advised to diversify the risk by adding safe-haven assets to their portfolios. Social implications: The findings shed light on the importance of environmentally and socially responsible investments as a separate asset class where ecologically friendly and socially sentimental investors could invest in diversifying the risk of their portfolios. Originality/value: The paper offers valuable insights to policymakers and investors regarding asset pricing, risk management and financial market stability during pandemic-type emergencies. [ABSTRACT FROM AUTHOR]

Sustainable investing and financing play a central role in achieving sustainable development goals. Using high‐quality articles from the Scopus database, this study deploys bibliometric analysis followed by content analysis on 528 and 33 articles to synthesise the academic literature on sustainable investing and financing published between 2012 and mid‐2022 and analyse the field's evolution and progress in research. The performance analysis identifies the field's most influential studies, and the conceptual and intellectual structures shed light on foundational themes and research progression. An in‐depth content analysis identifies and reveals novel insights on three primary research themes: financing sustainability, asset returns, and sustainable outcomes. The key issues encompass investor motivations and investment performance of sustainable investments compared to conventional investments, challenges, and policy enablers that aid the development of sustainable financing and sustainability outcomes. The study also offers future research directions and concisely summarises research using the theories‐context‐characteristics‐methods framework. The findings will help further theory development in academic research on sustainable investing and financing and have practical implications for investors, issuers, and regulators. Investors can gain insights into the performance of sustainable investments, issuers can understand the benefits of adopting sustainable finance, and regulators can obtain insights into the policy enablers that would result in more efficient outcomes. The limitation of the study is that it is qualitative and does not quantify factors or models that lead to sustainable development. [ABSTRACT FROM AUTHOR]

The impetus for adopting ESG-sensitive investment policies has increased steadily since 2006, when the United Nations outlined its Principles of Responsible Investment (PRI). Recently, a new industry aimed at helping investors to make sound ESG-driven decisions has flourished: ESG rating agencies. We investigated the ratings provided by four leading rating agencies (ISS, MSCI, S&P, and Sustainalytics) to the companies in the S&P500 index. Using measurement theory techniques, we concluded that ESG ratings currently exhibit an abysmally low level of reliability (18.3%) and agreement (5.4%). This situation differs sharply not only with the levels of reliability and agreement found in credit ratings but also with the reliability and agreement found in areas where subjectivity plays an important role, for example, wine ratings. These findings challenge the claim that ESG ratings can be helpful to make investment decisions, as they suggest that the ESG ratings industry as a whole is in much disarray. [ABSTRACT FROM AUTHOR]

Although green Sukuk (GS) as a sustainability enabler has started to emerge globally, a limited amount of research has focused on understanding its perspectives and potential. Accordingly, this research aims to explore the economic, social, and financial perspectives of GS by conceptualizing the effects of the issuance of green Sukuk (IGS) on economic growth (EG), social development (SD), and financial performance (FP). The fundamentals of the resource-based view (RBV) theory and institutional theory are employed to develop the theoretical underpinnings of this research. The panel data for IGS, EG, SD, and FP indicators between 2018 and 2021 were collected from Indonesia and were analyzed using the generalized method of movements regression technique. The results indicate that IGS positively interacts with all three indicators (EG, SD, and FP). Further analysis reveals that IGS has a moderate positive effect on EG, a weak positive effect on SD, and a significant positive effect on FP. Our research findings contribute to developing an integrated business landscape covering major domains of environmental sustainability, socioeconomic development, and financial performance under the GS theme. [ABSTRACT FROM AUTHOR]

Copyright of Izmir Journal of Economics is the property of Dokuz Eylul University, Faculty of Economics & Administrative Sciences and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

This article investigates whether sustainability labels for mutual funds in Europe provide consistent signals regarding funds' sustainable characteristics. Specifically, we assess the alignment of signals conveyed by third-party and self-declared labels. Among the first typology, we consider labels sponsored by government and nonprofit organizations (GNPOs) alongside Environmental, Social, and Governance (ESG) ratings from commercial data vendors. The latter category includes the Sustainable Finance Disclosure Regulation (SFDR) classification and an ESG-related name. Our findings indicate that equity funds with GNPO labels are more likely to exhibit top-tier ESG ratings and alignment with self-declared sustainability signals, namely Article 9 of SFDR and fund names. Furthermore, holding government and multiple GNPO labels is linked to other signals indicating higher sustainability standards. In addition, funds tend to experience an improvement in Morningstar globes after receiving a GNPO label, consistent with GNPO labels signaling funds of the high-quality type. The results regarding label alignment in fixed-income funds are less conclusive. Our findings underscore the need for credible signals in view of the growing number of sustainability labels available to investors. [ABSTRACT FROM AUTHOR]

Socially responsible investments (SRI) suffer from a lack of investments from individual investors, despite their positive attitudes toward SRI. This attitude–behavior gap is a serious issue, as SRI is often perceived as a way to promote sustainable development. We investigate nudges, especially the default option, as a way to encourage SRI. In a pre‐registered study conducted in October 2021 with 1050 US investors, we pit four nudges against one another to encourage individual investors to invest in SRI. All nudges significantly increased investment in SRI compared with the control group. Making SRI the default option with frictions to opt‐out is the most efficient intervention. This is closely followed by a default option without friction to opt out and option partitioning, which are not significantly different from each other. Precommitment, although statistically significant, has a modest effect on investment in SRI and is inferior to the other nudges. Overall, the two types of default as well as option partitioning are significant and impactful solutions for increasing investment in SRI. [ABSTRACT FROM AUTHOR]

We use the daily data from 1 October 2010 to 1 March 2021 on the stock prices of several global, regional, and country-specific ESG indices of the Dow Jones Sustainability Index family (DJSI) and MSCI family to analyse the relative performance of sustainable indices (ESG) and corresponding conventional benchmarks. In terms of classic risk and return characteristics and modern portfolio metrics, we report mixed evidence with some sustainability indices marginally outperforming the traditional benchmarks and others staying at parity. Regionally, the evidence is heterogeneous; the Pan Arab, the Middle East (including Israel), the United States, Emerging Markets, and Europe indices reported a slightly superior performance and those belonging to Asia Pacific, Emerging Africa, and Latin America marginally underperformed compared to their conventional counterparts. The findings of this study imply that sustainable investments appear to be an encouraging investment option, although their progress has not been substantial. For an appreciable outperformance of sustainable investments, a more conducive regulatory framework should be established, including robust incentivizing policies concerning tax rebates or low capital costs. [ABSTRACT FROM AUTHOR]

Socially Responsible Investments (SRI) have recently generated much interest among asset owners, managers and academicians. Though the Efficient Market Theory suggests that stock prices fully reflect all available information, few existing studies indicate that Environmental, Social and Governance (ESG) portfolios deliver superior risk‐adjusted performance. ESG investing is at a nascent stage in India but is growing rapidly, especially after the COVID‐19 pandemic. Asset managers always face the dilemma of choosing between different screening methods, screening intensities and stock weighting schemes to deliver outperformance. Our study attempts to investigate the impact of these portfolio construction criteria on the risk‐adjusted performance of ESG portfolios in India. Our results show that there exists a trade‐off between superior investment performance and unsystematic risk of ESG portfolios. Investors can benefit from investing in equally‐weighted best‐in‐class portfolios constructed using ESG scores. We highlight the implications of our findings for asset owners, managers, index providers and regulators, and also provide directions for future research in the area of ESG portfolio management. [ABSTRACT FROM AUTHOR]

Introduction: Socially responsible investments (SRI) increased their popularity among investors over the last two decades. However, there is still a lack of knowledge on socially responsible investors' characteristics and motivations behind the decision to invest in SRI. The present paper aims at filling this gap by profiling current and potential sustainable investors. Method: Cross-sectional data from a representative sample of Italian consumers (N = 1,002) was used to perform a Latent Profile Analysis (LPA), a clustering technique, and identify various sub-groups within the respondents. Subsequently, chi-square test and one-way ANOVA were performed to determine which profile(s) was mostly associated with current and potential socially responsible investing. Results and discussion: Five profiles of consumers were identified through the LPA, each one differently associated with the likelihood of investing in socially responsible products. The profile that best describes sustainable investors is characterized by high levels of knowledge toward SRI, risk appetite, positive attitudes on SRI, personal norms, perceived behavioral control, environmental concerns, and connectedness to nature. These findings suggest that non-financial aspects, namely psychological characteristics such as attitudes and personal values, play a key role in the decision to invest responsibly as well. [ABSTRACT FROM AUTHOR]

The development of “sustainable” finance, that is, financial instruments operating in the context of the implementation by companies of a set of environmental, social and governance principles (ESG principles), is gaining momentum in the main world markets. According to the Global Alliance for Sustainable Investments, these strategies already account for 35.9% of the total amount of invested assets. This trend is driven by a new global reality since the long-term development of the country and the company cannot be possible without resolving deepening environmental and social contradictions. In this regard, the purpose of this article is to develop recommendations acceptable to the practice of Kazakhstan based on the generalization of contemporary international experience in the development of various instruments of sustainable finance, as well as on studying institutional support measures for this process at the macroeconomic level.A review of the experience of several countries leading in the field of environmentally and socially responsible investment demonstrates both general and specific features that can be successfully implemented in Kazakhstan, which is at the initial stage of this process. The research methodology is based on a comparative analysis of public policy, regulatory framework, and national specifics of the models of the six selected countries and regions. The obtained results have corresponding practical implications in terms of sustainable finance and ESG criteria-based investing regulation advancement in Kazakhstan by foreign practices adaptation.

Copyright of Ruch Prawniczy, Ekonomiczny i Socjologiczny (0035-9629) is the property of Adam Mickiewicz University and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

IntroductionSocially responsible investments (SRI) increased their popularity among investors over the last two decades. However, there is still a lack of knowledge on socially responsible investors' characteristics and motivations behind the decision to invest in SRI. The present paper aims at filling this gap by profiling current and potential sustainable investors.MethodCross-sectional data from a representative sample of Italian consumers (N = 1,002) was used to perform a Latent Profile Analysis (LPA), a clustering technique, and identify various sub-groups within the respondents. Subsequently, chi-square test and one-way ANOVA were performed to determine which profile(s) was mostly associated with current and potential socially responsible investing.Results and discussionFive profiles of consumers were identified through the LPA, each one differently associated with the likelihood of investing in socially responsible products. The profile that best describes sustainable investors is characterized by high levels of knowledge toward SRI, risk appetite, positive attitudes on SRI, personal norms, perceived behavioral control, environmental concerns, and connectedness to nature. These findings suggest that non-financial aspects, namely psychological characteristics such as attitudes and personal values, play a key role in the decision to invest responsibly as well.

Despite the increased interest in socially and environmentally responsible investments, there is a lack of consensus about the effects they exert on companies’ financial performance. The paper examines the reaction of Russian companies’ stock prices to the news about ESG investments made by these companies. The theoretical basis is stakeholder theory suggesting that firms can achieve long-term success solely by protecting the interests of all their stakeholders – not only shareholders, but also employees, local communities, and future generations. To implement the research, we use the event study on a sample of 202 news items about ESG investments of 11 Russian companies topping the ESG-rating by RA-Expert agency. Data were collected from news search engine Factiva and Yahoo!Finance. The data sample include news and stock prices over the period of 2019–2022. According to the research findings, news about Russian companies’ investments in environmental projects, solution of social problems and corporate governance issues do not lead to a rise in stock returns for these companies. Thus, Russian investors do not consider ESG projects and practices as an important decision-making criterion that increases the investment attractiveness of companies.

Socially responsible investments are a significant element of the global capital market and are becoming increasingly important also in the eyes of Polish investors. ESG ratings are a crucial decisive criterion, as they provide information on the corporate governance (G), and social (S) and environmental (E) activities, of companies. Even though the abovementioned areas differ significantly, the use of ESG ratings by investors is often narrowed down to the total ESG score. Additionally, the literature does not provide unambiguous results on whether the impact of total score as well as the individual pillars of E, S and G on the accounting-based financial performance of companies is statistically significant, and positive or negative. Sparse academic studies concentrate mainly on highly developed markets and accounting-based measures of profitability, leaving aside emerging markets, like Poland, and the other main characteristics of financial performance, like liquidity, efficiency, or leverage. The aim of this paper is therefore to fill the above gap by identifying the dependence of ratings in E, S and G areas and the accounting-based financial performance of companies listed on the Warsaw Stock Exchange. Selected financial parameters and company quotations were taken from the Notoria Serwis SA database, while data on ESG ratings from Refinitiv Eikon were used to perform correlation analysis. The analysis covers the years 2013–2022. The findings indicate a significant positive bi-directional impact of corporate governance (G) and efficiency, as well as of controversies score and efficiency. A linkage has also been revealed between controversies score and profitability. However, the hypothesis of an unequivocally positive impact of ESG factors on financial results, or conversely of financial results on ESG aspects, should be rejected.

Community energy initiatives play a significant role at the grassroots level in the transition to Renewable Energy Communities and a low-carbon economy. However, these initiatives are hampered by multiple barriers at the market, institutional, organisational, and individual level. Funding cuts of state-supported feed-in tariff (FiT) policy in major markets such as Germany, Japan, China and the additional capping of the number of new installations that could be accredited under the FiT scheme in the UK. In light of these market changes and the need to accelerate the development and growth through the creation of new and/or complementary future community energy models consisting of private investors, a detailed understanding of the dynamics of community energy investor characteristics and socio-psychological motivations is increasingly important. First, a review is conducted including the theories that underpin and explain the factors that affect investor behaviour, after which a conceptual framework to examine investor behaviours towards socially responsible community energy initiatives is developed. The framework is used as the basis to construct and administer a survey involving sampling of 295 UK investors in community energy initiatives and the subsequent statistical analysis of the survey data and discussions of the findings. The results first capture the differences among investors with differing regional affect and investment behaviours. The study also provides the needed insight into better understanding the dynamics of investor characteristics and motivations of community energy initiatives. Results also indicate that investors are predominantly ethically-oriented, particularly toward environmental concerns. Additionally, community and social factors also appear to play significant roles in investor participation while financial orientation is least dominant.

Socially responsible investments (SRIs) have occupied the center stage of discussion in the finance and social discourses. This study aims to unravel the intellectual structure of the research on SRI. At present, SRI is undertheorized, and the extant literature is divided into multiple fragments. Existing review studies on SRI suffer from limitations related to definitions and methods. We organize the theoretical lines of extant research and tie them up with empirical studies in the field by using systematic literature review and bibliometric techniques on a corpus of as large as 976 research articles. Our study describes the current dynamics of the SRI field, clusters the fragments of research into meaningful themes, highlights the impediments to current research, and also proposes an agenda for future research. Although research on SRI occurs globally, the lack of academic collaboration among scholars and undertheorization are two major challenges of the field. Future research could examine ESG‐based asset pricing models, sustainable factor investing, and measures to tackle greenwashing. [ABSTRACT FROM AUTHOR]