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The market for socially responsible investing: a review of the developments

The market for socially responsible investing: a review of the developments This study aims to explain how socially responsible investing (SRI) has evolved in the past few decades and sheds light on its latest developments. It describes different forms of SRI in the financial markets, and deliberates on the rationale for the utilization of positive and negative screenings of listed businesses and public organizations.Design/methodology/approachA comprehensive literature review suggests that the providers of financial capital are increasingly allocating funds toward positive impact and sustainable investments. Therefore, this descriptive paper provides a factual summary of the proliferation of SRI products in financial markets. Afterwards, it presents the opportunities and challenges facing the stakeholders of SRI.FindingsThis research presents a historic overview on the growth of SRI products in the financial services industry. It clarifies that the market for responsible investing has recently led to an increase in a number of stakeholders, including contractors, non-governmental organizations and research firms who are involved in the scrutinization of the businesses’ environmental, social and governance (ESG) behaviors.Originality/valueThis discursive contribution raises awareness on the screenings of positive impact and sustainable investments. The researcher contends that today’s socially responsible investors are increasingly analyzing the businesses’ non-financial performance, including their ESG credentials. In conclusion, this paper puts forward future research avenues in this promising field of study. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Social Responsibility Journal Emerald Publishing

The market for socially responsible investing: a review of the developments

Social Responsibility Journal , Volume 17 (3): 17 – Apr 30, 2021

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Publisher
Emerald Publishing
Copyright
© Emerald Publishing Limited
ISSN
1747-1117
eISSN
1747-1117
DOI
10.1108/srj-06-2019-0194
Publisher site
See Article on Publisher Site

Abstract

This study aims to explain how socially responsible investing (SRI) has evolved in the past few decades and sheds light on its latest developments. It describes different forms of SRI in the financial markets, and deliberates on the rationale for the utilization of positive and negative screenings of listed businesses and public organizations.Design/methodology/approachA comprehensive literature review suggests that the providers of financial capital are increasingly allocating funds toward positive impact and sustainable investments. Therefore, this descriptive paper provides a factual summary of the proliferation of SRI products in financial markets. Afterwards, it presents the opportunities and challenges facing the stakeholders of SRI.FindingsThis research presents a historic overview on the growth of SRI products in the financial services industry. It clarifies that the market for responsible investing has recently led to an increase in a number of stakeholders, including contractors, non-governmental organizations and research firms who are involved in the scrutinization of the businesses’ environmental, social and governance (ESG) behaviors.Originality/valueThis discursive contribution raises awareness on the screenings of positive impact and sustainable investments. The researcher contends that today’s socially responsible investors are increasingly analyzing the businesses’ non-financial performance, including their ESG credentials. In conclusion, this paper puts forward future research avenues in this promising field of study.

Journal

Social Responsibility JournalEmerald Publishing

Published: Apr 30, 2021

Keywords: SRI; Socially responsible investment; Sustainable investment; Stakeholder engagement; Screening; Social responsibility

References