Ethical investing is all the rage. Unfortunately, excitement about it has outpaced plausible philosophical discussions. This article asks and answers two questions: “What counts as investment?”, and “What moral choices do investors have?”. I answer the first question broadly. Investment is pervasive in our economy, and by participating we share responsibility for corporate practices. These facts lead to an “austere conclusion”: short of outright withdrawal from the standard forms of investment, we have little hope of avoiding participation (...) in immoral activities. Thus we must withdraw. Fortunately, the answer to the second question mitigates this disturbing result. Under certain circumstances, shareholder activism aimed at moral goals is a valuable way to participate in a deeply flawed system. By demonstrating the pervasiveness of investment and analogies with consumption and democratic political participation, the conclusions of this paper illuminate not only the ethics of investment but a more-general problem of individual responsibility in complex institutions. The paper is informative both for its applicability to these latter questions, and for its demonstration that investment is not merely a side-topic for business ethics texts, but rather a central problem of modern market societies. (shrink)

Ethical or socially responsible investment is one of the most rapidly growing areas of finance. New government regulations mean that all pension funds are obliged to take such considerations into account. However, this phenomenon has received little critical attention from business ethicists, and a clear conceptual framework is lacking. This paper, by a practitioner in the field, attempts to fill this analytical gap. It considers what difference, if any, lies between the terms ‘ethical’, ‘green’, or ‘socially responsible’. It also (...) tackles the difficult question of how any public form of investment can be called ‘ethical’ in an overtly pluralistic society. The paper provides an account of the historical development of ethical investment, and traces the evolution of the varying terms used to describe it. This is followed by a conceptual analysis of these terms, and a description of ethical decision‐making in this context. The paper ends by considering the role of shareholder action within ethical investment, and assesses the utility of the stakeholder model as a theoretical justification. (shrink)

Ethical investors are widely thought of as having two main goals. The negative goal of avoiding their investments to be morally tainted. The positive goal to further a certain ethical value they embrace or some normatively laden idea they hold by investing their money in a certain company. In light of these goals, the purpose of this paper is to provide an account of how we can explicitly include investors’ intentions when conceiving of ethical investment. The central idea is (...) that an investor’s intentions may act as both a negative and a positive qualifier for making investing ethical. If we subscribe to this account, there are interesting upshots with respect to how ethical investing compares to ethical giving as effective altruists construe it. (shrink)

Several studies have suggested a matrilateral bias in allomaternal (non-maternal) infant and child caregiving. The bias has been associated with the allomother’s certainty of genetic relatedness, where allomothers with high certainty of genetic relatedness will invest more in children because of potential fitness benefits. Using quantitative behavioral observations collected on Ngandu 8- to 12-month-old infants from the Central African Republic, I examine who is caring for infants and test whether certainty of genetic relatedness may influence investment by allomothers. Results (...) indicate a matrilateral bias in caregiving by extended kin members, but this does not affect the total level of care infants receive when fathers and siblings are included in the analysis. These results replicate a previous study done among an adjacent foraging population and emphasize the importance of examining children’s complete social environments when addressing caregiving and child development. (shrink)

This study examines child survival and growth in a patrilineal Ethiopian community as a function of father absence and sex. In line with evolutionary predictions for sex-biased parental investment, the absence of a father and associated constraints on household resources is more detrimental for sons’ than daughters’ survival in infancy. Father absence doubles a son’s risk of dying in infancy but has a positive influence on the well-being of female members of the household, improving daughter survival, growth, and maternal (...) nutritional status. Lack of paternal investment may be compensated for by other matrilateral kin through increased reciprocity between mother, daughter, and sister. (shrink)

The UK Alternative Investment Market (AIM) was launched in 1995 and has been a great success with over 1200 companies now listed. In this article, we examine the development of AIM as it reaches its 15th year and discuss the potential pitfalls of the light touch regulation that is one of the attractions of AIM and identify potential corporate governance and ethical issues that may arise as a result of light touch regulation. We examine the central role of the (...) nominated advisor (NOMAD) and draw on the findings of in depth interviews with 25 AIM participants including AIM company directors, institutional investors, nominated advisors and brokers. We highlight the influence of the NOMAD on these participants and potential governance and ethical implications. We also discuss some of the concerns that AIM participants have about the market. We examine some of the recent scandals on AIM to determine why these scandals occurred — were they, for example, attributable to corporate governance weaknesses? Finally, we offer some concluding comments to discuss the future of AIM. The findings of the article have important implications for investors and policymakers alike. (shrink)

This article addresses the growing industry of retail socially responsible investment (SRI) profiled mutual funds. Very few previous studies have examined the final consumer of SRI profiled mutual funds. Therefore, the purpose of this study was to, in an exploratory manner, examine the impact of a number of pro-social, financial performance, and socio-demographic variables on SRI behavior in order to explain why investors choose to invest different proportions of their investment portfolio in SRI profiled funds. An ordinal logistic (...) regression analysis on 528 private investors revealed that two of the three pro-social variables had a positive impact on how much the consumer invested in SRI profiled funds. Moreover, there was proof of a non-altruistic motive for investing in SRI as consumers who perceive that financial return of SRI is equal or better than "regular" mutual funds, invested a greater proportion of their portfolio in SRI profiled mutual funds. Furthermore, the results showed that women and better-educated investors were more likely to invest a greater proportion of their investment portfolio in SRI. Overall, the findings indicate that both financial perceptions and pro-social attitudes are connected to consumer investment in SRI. (shrink)

What motivates grandparents to their altruism? We review answers from evolutionary theory, sociology, and economics. Sometimes in direct conflict with each other, these accounts of grandparental investment exist side-by-side, with little or no theoretical integration. They all account for some of the data, and none account for all of it. We call for a more comprehensive theoretical framework of grandparental investment that addresses its proximate and ultimate causes, and its variability due to lineage, values, norms, institutions (e.g., inheritance (...) laws), and social welfare regimes. This framework needs to take into account that the demographic shift to low fecundity and mortality in economically developed countries has profoundly altered basic parameters of grandparental investment. We then turn to the possible impact of grandparental acts of altruism, and examine whether benefits of grandparental care in industrialized societies may manifest in terms of less tangible dimensions, such as the grandchildren's cognitive and verbal ability, mental health, and well-being. Although grandparents in industrialized societies continue to invest substantial amounts of time and money in their grandchildren, we find a paucity of studies investigating the influence that this investment has on grandchildren in low-risk family contexts. Under circumstances of duress there is converging evidence that grandparents can provide support that helps to safeguard their children and grandchildren against adverse risks. We conclude by discussing the role that grandparents could play in what has been referred to as Europe's demographic suicide. (shrink)

This research studies the optimal consumption, investment, and life insurance choices for a wage earner with habit formation, inflation risk, and mortality risk. The wage earner has access to a risk-free asset, an index bond, and a stock in a financial market. The index bond hedges inflation risk, while life insurance hedges mortality risk. The aim of the wage earner is to maximize the expected utility of consumption, bequest, and terminal wealth, where the utility of consumption comes from the (...) part of the consumption that exceeds a minimum consumption requirement given by the habit level. By using the dynamic programming method, we provide and prove a verification theorem and obtain closed-form expressions for the value function, the optimal life insurance premium rate, and the optimal investment and consumption strategies. Numerical results reveal that habit formation and mortality force change play important roles in the financial behaviors of the wage earner. Especially, the impacts of the expected inflation rate and consumption habit on the optimal strategies are mutual restraint; increasing mortality force raises the demand for life insurance; and the effects of other parameters are also affected by consumption habit and mortality force change. (shrink)

Interest in the notion of the possible financial sacrifice suffered by socially responsible investment (SRI) fund investors for considering ethical, social and environmental issues in their investment decisions has spawned considerable academic interest in the performance of SRI funds. Both the Australian and international research literature have yielded largely mixed results. However, several of these studies are hampered by methodological problems which can obscure the significance of reported results, such as the use of small sample sizes, inconsistencies in (...) the time frames selected to analyse performance and different modelling frameworks used to estimate investment returns. This study attempts to redress some of these issues by investigating the returns performance of 89 ethical funds in Australia over the period 1986-2005. Using a multi-factor CAPM model [Fama, E. F., and K. R. French (1996) J. Finance 51(1), 55] (which controls for factors such as size, book-to-market value and momentum) we find that ethical funds significantly under-perform the market in Australia, particularly in the most recent 5 years of our sample period (2000-2005). Risk adjusted returns (using Jensen's alpha) indicate that average annual underperformance is around 1.52% in the 2000-2005 period for our sample and .88% over the whole sample period. Our results contrast with many previous studies (both Australian and international), which have not found statistically significant differences in the performance of ethical funds relative to market benchmarks and/or a matched sample of conventional funds. (shrink)

Artificial Intelligence (AI) has become a driving force in modern research, industry and public administration and the European Union (EU) is embracing this technology with a view to creating societal, as well as economic, value. This effort has been shared by EU Member States which were all encouraged to develop their own national AI strategies outlining policies and investment levels. This study focuses on how EU Member States are approaching the promise to develop and use AI for the good (...) of society through the lens of their national AI strategies. In particular, we aim to investigate how European countries are investing in AI and to what extent the stated plans contribute to the good of people and society as a whole. Our contribution consists of three parts: (i) a conceptualization of AI for social good highlighting the role of AI policy, in particular, the one put forward by the European Commission (EC); (ii) a qualitative analysis of 15 European national strategies mapping investment plans and suggesting their relation to the social good (iii) a reflection on the current status of investments in socially good AI and possible steps to move forward. Our study suggests that while European national strategies incorporate money allocations in the sphere of AI for social good (e.g. education), there is a broader variety of underestimated actions (e.g. multidisciplinary approach in STEM curricula and dialogue among stakeholders) that can boost the European commitment to sustainable and responsible AI innovation. (shrink)

Ethical investment (also known as social investment, socially responsible investment [SRI], or sustainable investment) typically refers to the practice of integrating putatively ethical, social, or environmental considerations into a financial investment process – for instance, a pension fund's process of deciding what stocks or bonds to buy or sell. Whereas conventional or mainstream investment focuses solely upon financial risk and return, ethical investment thus also includes various nonfinancial goals or constraints in typical (...) class='Hi'>investment decisions. This type of investment has grown to be a well-established feature of many stock markets in the past two decades or so. A recurring point of debate, however, is to what extent this phenomenon indeed constitutes a more ethical alternative to conventional types of financial behavior. (shrink)

There appears to be an implicit assumption by those connected with the ethical investment movement (e.g., ethical investment firms, individual investors, social investment organizations, academia, and the media), that ethical investment is in fact ethical. This paper will attempt to challenge the notion that the ethical mutual fund industry, as currently taking place, is acting in an ethical manner. Ethical issues such as the transparency of the funds and advertising are discussed. Ethical mutual fund screens such (...) as tobacco, alcohol, gambling, and the military are preliminarily examined to better determine whether they can actually be defined as "ethical" screens as opposed to merely social, political, or religious screens. A code of ethics for ethical investment is constructed by which ethical mutual fund firms can be audited for ethical compliance. (shrink)

This article discusses socially responsible investing (SRI) and tobacco. SRI allows investors, both institutional and individual, to express their concerns and make their social and ethical stands known to the companies they invest in and patronize. The tobacco industry is active in every country on the globe and generates huge profits, while tobacco use is responsible for 4 million deaths every year.The authors explore past and current views on investment in tobacco, partly based on a survey conducted by the (...) Tobacco Free Initiative of the World Health Organization (WHO). There is clearly a trend toward divestment from tobacco for both ethical and financial reasons. Tobacco-free investments can be both ethically sound and financially profitable. (shrink)

Environmental, social, and governance (ESG) investing is synonymous with sustainable investment for socially responsible investors. Unfortunately, the diversity of ESG investing remains unattended amidst the growth in ESG literature, as the academic literature focuses dominantly on measuring performance. An understanding of a wide range of subjects entailing ESG is required before future research on ESG investing is performed. To overcome the challenge, this systematic literature review uses bibliometric mapping to reveal four significant research themes within the ESG investing literature: (...) investor behavior and motivations for ESG investing; cost and risk mitigation in ESG investing; portfolio screening and ESG investing; and ESG performance. The review critically examines each theme and broadens the research agenda for future studies. In addition to the significant themes, this paper also discusses theoretical and recent research trends in the ESG investing literature. The review identifies clashes and crossovers between these themes to appropriately interpret one theme using another and emphasizes the heterogeneity in ESG investing. Lastly, discussion over concerns and criticisms of ESG investing highlights greenwashing as a major cause of concern for investors. (shrink)

This paper explores two types of investment in the current People’s Republic of China, both of which promote fantasies about the past and future, presumably as a way to forestall uncomfortable conversations about the present. But the author is less interested in state decisions than in what makes an unofficial person “buy into” such fantasies. Her answer is, “misperceptions about tradition”, longstanding cultural preoccupations, and genuine desires to secure honor and glory in an insecure world. Her largely diagnostic paper (...) briefly considers possible responses to the question, “What, in such a dire situation, can be done to introduce more complex notions of sedimented identities?”. (shrink)

The Durban Platform for Enhanced Action was adopted at the 2011 United Nations Framework Convention on Climate Change Conference (UNFCCC) in South Africa and one of the key achievements of the 2011 UN Conference was the agreement on and the launch of the Green Climate Fund. As the international community prepares for the 2012 UNFCC talks to start in Qatar in November-December 2012, the past history of global environmental and climate change financing issues as well as the role of finance (...) and investment in addressing global climate change will be examined in this article using the Green Climate Fund as a case study. While it is hard to be optimistic about the current international geo-political context and the policy success of the Durban Platform for Enhanced Action, the Green Climate Fund does represent a real opportunity to move forward on global climate governance and bring real economic and technological dividends to the developing world. (shrink)

This paper examines the different mechanisms used by multinational corporations (MNCs) in Nigeria seeking to make long-term social investments by meeting the critical challenge of improving water provision. Community enterprise – an increasingly common form of social enterprise, which pursues charitable objectives through business activities – may be the most effective mechanism for building local capacity in a sustainable and accountable way. Traditionally, social investments by MNCs have involved either donations to a charity, which then assumes responsibility for delivering social (...) outcomes, or direct management of social investment in-house. These approaches have been criticized, however, for their limited contribution to local capacity building, their focus on short-term outcomes, and the restricted role that they afford to communities. Partnering with community enterprise, provided there is sufficient local capacity to support it, is the most effective mode of governance through which MNCs can manage social investments in developing countries. (shrink)

Expropriation is a hotly debated issue in international investment law. This is the first study to provide a detailed analysis of its norm-theoretical dimension, setting out the theoretical foundations underlying its understanding in contemporary legal scholarship and practice. Jörg Kammerhofer combines a doctrinal discussion with a theoretical analysis of the structure of the law in this area, undertaking a novel approach that critically re-evaluates existing case-law and writings. His approach critiques the arguments for a single expropriation norm based on (...) custom, interpretation and arbitral precedents within international investment law, drawing also on generalist international legal thought, to show that both cosmopolitan and sovereigntist arguments are largely political, not legal. This innovative work will help scholars to understand the application of theory to investment law and help specialists in the field to improve their arguments. (shrink)

Market crises amplify fear, disrupting rational decision-making of stock investment. This study examines the relationship between investors’ information priorities—such as intuition, company performance, technical analysis, and other factors—and their fear responses (freeze, flight, and hiding) during market crashes. Using the Bayesian Mindsponge Framework (BMF) to analyze data from 1,526 investors in China and Vietnam, the findings reveal complex dynamics. We found positive associations between investors’ prioritization of social influence and intuition for investment decision-making with being freeze (i.e., not (...) knowing what to do with the owned stock), between prioritization of professionals’ evaluation and intuition with fleeing (i.e. giving up stock investment permanently), and between prioritization of professionals’ evaluation and social influence with hiding (i.e., stopping investing in stock for a while). In contrast, prioritization of companies’ performance metrics (e.g., net profit, debt, etc.) was negatively associated with being freeze, fleeing, and hiding. Meanwhile, prioritization of professionals’ evaluation, technical analysis, and liquidity was negatively associated with being freeze, fleeing, and hiding, respectively. The study highlights the importance of disseminating transparent, accurate information through government and media channels, along with implementing financial education programs, to promote rational investment decisions and reduce fear-driven behaviors. (shrink)

Although there is substantial literature examining the flow of foreign investments into various regions of the world, there is still a lack of research about joint ventures and foreign investment activities in the Middle East and North Africa (MENA). One objective of this paper is to remedy this neglect and extend previous empirical work by focusing on foreign investments in the MENA region. The second objective is to focus on non-traditional determinants that have tended to be overlooked or underestimated (...) in previous research. The increasing globalization has led to a reconfiguration of the ways in which multinationals pursue various types of foreign investments,and changed the motives for and the determinants of FDI. This has prompted some to suggest that non traditional determinants have become more important. In view of that, the paper will focus on factors such as governance, legal environment, and economic freedom and examine their impact on foreign investment activities in the MENA region. (shrink)

Religious organisations are major investors with sometimes substantial investment volumes. An important question for them is how to make investments in, and to earn returns from, companies and activities that are consistent with their religious beliefs or that even support these beliefs. Religious organisations have pioneered responsible investment. Yet little is known about their investment attitudes. This article addresses this gap by studying faith consistent investing. Based on a survey complemented by interviews, we investigate religious organisations’ attitudes (...) towards responsible investment including opinions, practices and the impediments for implementing faith consistent investing. Although our results cannot be generalised because of the non-random character of our sample, six main characteristics of faith consistent investing are drawn: investing is not perceived as being in contradiction with religious values, religious values are important drivers, there is a strong community around faith consistent investing, religious investors are pioneering impact investing, implementing faith consistent investing is not without difficulties, and practices vary across regions. The survey also reveals that faith consistent investing has many commonalities with secular responsible investors. (shrink)

Sovereign Wealth Funds have attracted significant attention over the past few years, as a result of their increasing role in the global economy and their controversial minority investments in distressed financial and infrastructure companies in Western economies. Although SWFs provide important benefits to home, host and global markets, they have been perceived by the Western mind as a growing threat to economic supremacy and national security. While the current legal scholarship provides an incomplete policy response, by either selectively referring to (...) specific legal instruments within the international law framework or proposing an entirely new legal regime, this Article attempts to address this crucial lacuna by providing an original and comprehensive legal analysis of the SWF phenomenon and its interaction with the preexisting framework of international law. The various abovementioned concerns have prompted various Western attempts to block SWF cross-border investments through legislative reforms or ad hoc protectionism of the executive branch. These governmental policies frequently violate international commitments in the international economic law arena and call for a closer look at the nature of such commitments and their respective implementation in the SWF environment. The Article looks at recent practices in Western countries aimed at blocking SWF investments, especially in the context of iconic brands and national champions. It then reviews various relevant provisions in international legal instruments, which are applicable to these potential investments, and examines the question of their violation by capital-importing countries. A proposed innovative adaptation to this new reality is provided. I argue that the existing framework of international investment law can provide adequate solutions to investment protectionism against SWFs. Regarding regulation of SWFs’ investments, since recent experience has underlined that SWFs function largely like any other commercial entities, there is a need to shift the discussion and terminology towards regulation of sovereign activity rather than sovereign funds. Finally, the Article explores the broad consequences of investment law and corporate governance reforms following the debate around SWF investments on maintaining healthy and productive cross-border economic relations in a globalized world. (shrink)

With assets of over US$1.0 trillion and growing, public pension funds in the United States have become a major force in the private sector through their holding of equity positions in large publicly traded corporations. More recently, these funds have been expanding their investment strategy by considering a corporation's long-term risks on issues such as environmental protection, sustainability, and good corporate citizenship, and how these factors impact a company's long-term performance. Conventional wisdom argues that the fiduciary responsibility of the (...) pension funds' trustees must be solely focused on their beneficiaries and, therefore, their investment criteria must be based strictly on narrowly defined financial measures. It is also asserted that well-established financial measurements of corporate performance already include long-term risk assessment through discounted present value of future flow of earnings. Consequently, all other criteria are contrary to the best interest of the pension funds' beneficiaries. In this paper, we assert that, contrary to conventional wisdom, pension funds, and for that matter other mutual funds, must be concerned with the long-term survival and growth of corporations. These measures are generally referred to "socially responsible investing" and when applied to corporations, it is termed "socially responsible corporate conduct." We demonstrate that current measurement of future risk assessment invariably understates, and quite often completely overlooks, these long-term risks because of the inherent bias towards short-run on the part of financial intermediaries whose compensation depends greatly on short-term results. Furthermore, there is ample evidence to suggest that these intermediaries have been engaging in self-serving practices and thus failing in their duties to serve their clients', i.e. pension funds', best interests. Because of their large holdings in the total market as well as individual companies, these funds cannot easily divest from poorly performing companies without destabilizing the companies' stock and overall markets. Hence, they must opt for a strategy of emphasizing investment criteria that encourage companies to take into account long-term aspects of their operations in terms of their impact on environment, sustainability, and community welfare, to name a few. We argue that an exclusionary, and even a primary, focus on short-term financial criteria is no longer a viable option. It also calls for the pension funds to encourage greater transparency and accountability of the entire corporate sector through improved corporate governance. Thus socially responsible investing practices are not merely discretionary and desirable activities; they are a necessary imperative, which both the corporations and public pension funds, and other large institutional holders, will ignore at serious peril to themselves. Finally, the paper considers some of the recent developments where corporations have been responding to these challenges and how their actions might be strengthened through greater disclosure and transparency of corporate activities. It also makes recommendations for the pension funds to support further research in creating new measurement standards that further refine the concept of socially responsible investing as a necessary ingredient of long-term corporate survival and growth in the context of a changing economic, environmental and socio-political dynamic. (shrink)

There is a growing body of literature on ethical or socially responsible investment across a range of disciplines. This paper highlights the key themes in the field and identifies some of the major theoretical and practical challenges facing both scholars and practitioners. One of these challenges is understanding better the complexity of the relationship between such investment practices and corporate behaviour. Noting that ethical investment is seldom characterised by agreement about what it actully constitutes, and that much (...) of the extant research focuses on a narrow set of issues, the paper argues that there are benefits associated with examining ethical investment as a process. (shrink)

More South African investors are integrating their personal values into their investment decisions. Research on the performance of socially responsible investment funds, also called ethical funds, yields conflicting results. In this study, the risk adjusted performance of 14 local SRI funds have been evaluated vis-à-vis their respective benchmarks. The results of the Treynor and Sharpe ratios indicate that the majority of funds outperformed their respective benchmarks over the period 1 July 2001 to 31 June 2004 and all but (...) one fund posted positive Alphas. These results thus appear consistent with previous research which shows that ethics indeed pays. (shrink)

The activism of institutional investors tends more and more toward the supervision and control of the behavior of the managers of big companies. In this article, we present a model based on the creation of an activism index that lets us evaluate such activism’s effect on the sensitivity of the investment policies of a company in the face of financial variables (such as cash flow and liquidity ratio) and market variables (ownership concentration and value creation index). To test our (...) assertions, we analyze firm-level data for United Kingdom (U.K.), Germany, France, Denmark, and Spain during the period 1995–2004. Our results point to a significant reduction in the sensitivity of company investment decisions in the face of these variables, especially relative to intangible capital, as a result of the neutralizing effect of activism on the high agency costs of free cash flow and on the information asymmetries of the market. (shrink)

In this paper the authors address the issue of investments made by family businesses. Their study attempted to verify the level of investments made by Polish family businesses in comparison with the level of investments made by Polish non-family businesses. The study focused on the analysis of investment flows of Polish listed companies included in the WIG index for the years 2006-2018. A total of 233 companies were analyzed, including 177 non-family businesses and 56 family businesses. The results corroborated (...) the argument that Polish listed non-family businesses invest much more money than family businesses. It was also observed that only a small percentage of companies in both groups invest their finances in research and development. (shrink)

In much of the developing world daughters receive lower education and other investments than do their brothers, and may even be so devalued as to suffer differential mortality. Daughter disadvantage may be due in part to social norms that prescribe that daughters move away from their natal family upon marriage, a practice known as virilocality. We evaluate the effects of virilocality on female disadvantage using data from the Indonesia Family Life Survey. We find little support for the hypothesis. There is (...) no evidence that the overall pattern of rough equality in the treatment of boys and girls in Indonesia masks differences according to post-marital residential practice. Virilocal groups do not have "missing daughters." Nor is there other evidence of son preference, such as in relatively low height-for-age or education for girls and women in virilocal areas. Explanations of daughter disadvantage as due to virilocality should be subject to further scrutiny and contextualization. (shrink)

Post-conflict economies often prove daunting for foreign investors. Many of these nations are reaching out to diasporans, emigrants, and their descendants living abroad, for much-needed foreign investment capital. Little is known about why diasporans invest in their countries of origin. Recent scholarly inquiry regarding investment decision making has suggested that non-pecuniary, psychological concerns often motivate investment decisions. We develop a conceptual model identifying three types of investment return expectations — financial, emotional, and those related to social (...) status — that may drive diaspora investment interest. We contend that the psychological realities and social-status structure of the diaspora experience generate greater salience for non-pecuniary investment motivations, particularly when the origin country emerges from a period of conflict. We outline an agenda for future research and discuss the implications of our model for policies seeking to promote peace utilizing diaspora investment. (shrink)

It is important for energy enterprises to research on the investment potential of the energy markets in countries along the “Belt and Road,” which can help them optimize the regional investment structure, reduce investment risks, and conform to the development trend of “going global.” Therefore, we construct an investment potential assessment system of 29 indexes including five dimensions: politics, economy, society, energy, and cooperation and assess energy investment potential of 48 sample countries along the “Belt (...) and Road” using principal component analysis to provide reference meanings for energy enterprises. The results show that the assessment results of investment potential are affected by a combination of multiple indexes. In addition, compared with Central Asia and South Asia, which have weak economic foundations and greater political and legal risks, the investment potential of Central and Eastern Europe and some emerging economies in Southeast Asia is higher. (shrink)

Several theoretical perspectives have generated research on grandparental investment, notably socialization and evolutionary psychological perspectives. Using data collected from more than 200 older adults (mean age 67 years), we test three hypotheses derived from socialization and evolutionary perspectives about grandparents’ relationships with and investment in grandchildren. Results indicate that (1) emotional closeness with both children and children-in-law is positively related to reports of emotional closeness with grandchildren; (2) maternal grandmothers invest more in grandchildren than do other grandparents; and (...) (3) grandparents invest more in daughters’ children than in sons’ children. Discussion addresses limitations of self-report methodology in this context and situates the current findings within the body of research indicating the existence of psychological mechanisms designed to guide differential nepotism. (shrink)

Impact investing is progressively losing focus in ensuring investments really do make a difference; therefore, the growth of the market may not make real social and environmental change. We propose three ways to put the “impact” back into the heart of impact investment.

Social investing, though not yet fully mainstream, has the potential to obtain such status. Questions relating to the future of social investing include the following. (1) What properly falls within the ambit of social investing? Assuming that no single definition of social responsibility is feasible, what then are the limits? (2) What do we need to know about investor psychology concerning social investing? What motivates people to buy socially screened investments and why do they sometimes act inconsistently? (3) How can (...) we improve the measures of social performance? Is it possible to develop GAAP and GAAS equivalents for social reporting? (4) Should social reports by firms be audited? If so, how? (5) What sorts of public policies are necessary to support the social screening of investments? (shrink)

Socially responsible investing (SRI) has emerged in recent years as a dynamic and quickly growing segment of the U.S. financial services industry involving over $2 trillion in professionally managed assets. Its conceptual origins can be found in the early history of civilization, with it's modern roots in the 1960s. This paper provides an overview of the breadth and depth of the concept and practice of socially and environmentally responsible investing, describes the investment strategies that together define SRI as currently (...) practiced in the U.S., offers several observations about some of the factors fueling its dramatic growth, and presents data showing that investors who choose to invest in a socially and environmentally responsible manner can do so without giving up investment returns. SRI has matured to a point where virtually any investment need can be met through portfolio design that integrates an investor's personal values, institutional mission, and/or social priorities. The socially responsible investment industry in the United States is a young phenomenon. Even referring to it as an "industry" ten years ago may have been a bit of a stretch. While it has grown dramatically in recent years, it is an area of work, of study and of practical application that continues to evolve in many significant ways. One intriguing example of the ongoing development of the field can be found in the analysis of the language used to describe it. The terms social investing, socially responsible investing, ethical investing, socially aware investing, socially conscious investing, green investing, values-based investing, and mission-based or mission-related investing all refer to the same general process and are often used interchangeably. (shrink)

Female-biased parental investment is unusual but not unknown in human societies. Relevant explanatory models include Fisher’s principle, the Trivers-Willard model, local mate and resource competition and enhancement, and economic rational actor models. Possible evidence of female-biased parental investment includes sex ratios, mortality rates, parents’ stated preferences for offspring of one sex, and direct and indirect measurements of actual parental behavior. Possible examples of female-biased parental investment include the Mukogodo of Kenya, the Ifalukese of Micronesia, the Cheyenne of (...) North America, the Herero of southern Africa, the Kanjar of south Asia, the Mundugumor of New Guinea, contemporary North America, and historical Germany, Portugal, and the United States. (shrink)

Investment Science, Second Edition, provides thorough and highly accessible mathematical coverage of the fundamental topics of intermediate investments, including fixed-income securities, capital asset pricing theory, derivatives, and innovations in optimal portfolio growth and valuation of multi-period risky investments. Eminent scholar and teacher David G. Luenberger, known for his ability to make complex ideas simple, presents essential ideas of investments and their applications, offering students the most comprehensive treatment of the subject available. New to this edition Three new chapters: Risk (...) Management, Credit Risk, and Data and Statistics Updated content and expanded coverage of many topics, including the capital asset pricing model, projection pricing, the Black-Scholes equation, computational methods, real options, the characterization of volatility, parameter estimation, and portfolio design New exercises reflecting advances in theory and practice provide opportunities to explore a wide range of concepts. (shrink)

The socially responsible investment industry (SRI) is slowly changing from a screening, avoidance paradigm to a comprehensive paradigm that seeks to affect corporate behavior. Credible rating systems are a key component of this sea change. Reliable and recognizable social and environmental metrics are critical to this progress. The Total Social Impact (TSI) rating approach is a new social metric scheme based on a comprehensive rating of stakeholder issues. This paper describes the evolution of SRI ratings and the role that (...) TSI hopes to play in affecting business behavior by promoting principled business leadership. (shrink)

Innovations in aligning investment with sustainability led to impact investing, enabling investors to achieve conventional financial returns and measurable social and environmental returns. Since its inception in 2007, it has grown manifolds, with significant efforts being made to create a global ecosystem. However, due to limited academic literature, the theme is yet to garner the scholarly interest it deserves. In this study, we analyse and visualise a knowledge map of the impact investment research field through a comprehensive bibliometric (...) analysis by employing a research corpus of 421 studies sourced from Web of Science and Scopus. We identify the growth trajectory, geographical concentration, productive and influential authors, journals and significant articles and examine the inter-disciplinarity of the field. The major research themes interlinked with impact investing included; social entrepreneurship, social innovation, social finance, impact investment market, innovative financial instruments, financialisation of essential services and impact reporting. To drive the field forward, future research needs to develop an impact investment ecosystem, address behavioural issues, stakeholder management and institutional context in impact investment theme, develop and diffuse innovative financial instruments, develop a framework for standardised accounting and reporting practices to measure financial and non-financial dimensions, tackle impact washing by fund managers, address lack of financial access to the third sector and develop the legal and regulatory framework for third sector organisations. (shrink)

Contemporary virtue ethics was revolutionized by Alasdair MacIntyre’s reconfiguration using practices as the starting point for understanding virtues. However, MacIntyre has very pointedly excluded the professions of the financial world from the reformulation. He does not count these professions as practices, and further charges that virtue would actually hinder or even rule out one’s pursuit of these professions. This paper addresses three tasks, in regard to the financial profession of investment advising. First, the paper lays out MacIntyre’s soon-to-be-published charges (...) against the investment world, as specified to this profession. Second, it sets forth the role function of investment advising and shows that it does possess internal goods—the crucial aspect of practices disputed by MacIntyre in this case—including goods of production and goods of performance. Third, it demonstrates that this function, and the goods tied to it, cannot be achieved apart from the virtuous pursuit of the profession, thereby showing that MacIntyre’s charges are mistaken. Investment advising is shown to be a virtue-based practice, and the groundwork is laid for showing that other financial professions are so, as well. (shrink)

This study provides novel evidence of the impact of corporate social responsibility (CSR) on investment sensitivity to cash flows. We posit that CSR affects investment–cash flow sensitivity (ICFS) through information asymmetry and agency costs, commonly viewed as the two channels through which investment responds to the availability of internal cash flows. We find that CSR performance leads to a decrease in ICFS. We further find that ICFS decreases (increases) when CSR strengths (concerns) increase. Finally, we find that (...) the effect of CSR on ICFS is driven by the areas Community, Diversity, and Human Rights. In sum, the findings of this study stress the relevance of CSR—in particular, of CSR activities that extend beyond compliance behavior and reflect what is desired by society—in reducing market frictions and improving firms’ access to financial capital. (shrink)

In this article I will describe the main elements of the Norwegian press’s moral confrontation with the Government Pension Fund’s ethical investment management when it was in an introductory phase in early 2005, with special emphasis on one newspaper, Stavanger Aftenblad. The press criticized the fund’s fresh investment profile and intended exclusionary practice before it had really started in earnest. Then I will focus on how the press’s unilateral criticism of the fund’s investment practice at the time (...) overshadowed a discussion of any defects in the ethical principles for investment. And I will focus on the press’s lack of distinguishing between information and sensation. In conclusion I point out that in 2006 the press has abandoned its critical stance from 2005 and has now a tendency to idealize the fund’s exclusionary practice and the underlying principles. (shrink)

Gaulin, McBurney, and Brakeman-Wartell (1997) found that college students reported both matrilateral and sex biases in the investment of aunts and uncles (aunts invested more than uncles). They interpreted the matrilateral bias as a consequence of paternity uncertainty. We replicated that study with Orthodox Jewish college students, selected because they come from a population we presume to have higher paternity certainty than the general population. The Orthodox sample also showed matrilateral and sex biases. Comparing the two data sets, the (...) Orthodox sample reported more investment, and slightly less matrilateral and sex biases, but the differences were not statistically significant. We did find an interaction between sex of relative and group membership, resulting from greater investment by Orthodox uncles. We interpret the results as reflecting the operation of a facultative investment mechanism whose upper limit is tuned to the maximum levels of paternity certainty found in ancestral environments. Lack of a difference in matrilateral bias between groups may result from levels of paternity certainty near to, or above, that maximum in both groups. (shrink)

Regulation must target the financial sector, which often funds and profits from environmentally unsustainable development. In an era of global financial markets, the financial sector has a crucial impact on the state of the environment. The long-standing movement for ethically and socially responsible investment (SRI) has recently begun to advocate environmental standards for financiers. While this movement is gaining more adherents, it has increasingly justified responsible financing as a path to be prosperous, rather than virtuous. This trend partly owes (...) to how financial institutions view their legal responsibilities. The business case motivations that now predominantly drive SRI are not sufficient to make the financial sector a means to sustainable development. Some modest legal reforms to improve the quality and extent of SRI have yet to make a tangible difference. A more ambitious strategy to promote SRI for environmental sustainability is possible, based on reforming the fiduciary duties of financial institutions. Such duties, tied to concrete performance standards, could make financiers invest in more ethically responsible ways. Other collateral reforms to financial markets, including improved corporate environmental reporting, are required to promote sustainability. (shrink)

Throughout the twentieth century, German writers, philosophers, theologians, and historians turned to Gnosticism to make sense of the modern condition. While some saw this ancient Christian heresy as a way to rethink modernity, most German intellectuals questioned Gnosticism's return in a contemporary setting. In No Spiritual Investment in the World, Willem Styfhals explores the Gnostic worldview's enigmatic place in these discourses on modernity, presenting a comprehensive intellectual history of Gnosticism's role in postwar German thought. Establishing the German-Jewish philosopher Jacob (...) Taubes at the nexus of the debate, Styfhals traces how such figures as Hans Blumenberg, Hans Jonas, Eric Voegelin, Odo Marquard, and Gershom Scholem contended with Gnosticism and its tenets on evil and divine absence as metaphorical detours to address issues of cultural crisis, nihilism, and the legitimacy of the modern world. These concerns, he argues, centered on the difficulty of spiritual engagement in a world from which the divine has withdrawn. Reading Gnosticism against the backdrop of postwar German debates about secularization, political theology, and post-secularism, No Spiritual Investment in the World sheds new light on the historical contours of postwar German philosophy. (shrink)