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Sustainable Investing Model for Decision Makers (Based On Research of Manufacturing Industry in the Czech Republic)

Faculty of Business and Management, Institute of Management, Brno University of Technology, Kolejni 2906/4, 612 00 Brno, Czech Republic
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Sustainability 2020, 12(20), 8342; https://doi.org/10.3390/su12208342
Received: 28 July 2020 / Revised: 22 September 2020 / Accepted: 28 September 2020 / Published: 10 October 2020
Sustainable investing is an investment approach in line with the values of sustainable development and compliance with environmental, social, and corporate governance (ESG) criteria. The aim of the article is to propose a sustainable investing model (SIM) to support the decision-making of responsible individual investors. The proposed model aggregates economic indicators of investment decision-making, positive and negative ESG criteria, the market value of the stock, a systematic and unsystematic risk (expressed by the capital asset pricing model (CAPM)), thus widening the investment triangle by another peak—and that is sustainability. The research methodology is based on four key areas (environmental, social, corporate governance, and economic) associated with sustainable investments, stock market value, and risk. The research methodology of structural equation models is applied for the construction of the SIM. Mathematical equations are used to apply the SIM, which expresses values, the so-called factor scores. For the classification of sustainable investments, a classification scale is created that divides investments into three groups: above-average, average, and below-average. The SIM comprehensively evaluates individual ESG criteria and economic areas of sustainable investments, thus assisting the investor in deciding on sustainable investments of Czech joint-stock companies in the manufacturing industry, including benchmarking with other sustainable investments. View Full-Text
Keywords: sustainability; sustainable investing; ESG criteria; market value of the stock; CAPM; Czech joint-stock companies; structural equation modelling sustainability; sustainable investing; ESG criteria; market value of the stock; CAPM; Czech joint-stock companies; structural equation modelling
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MDPI and ACS Style

Kocmanová, A.; Dočekalová, M.P.; Meluzín, T.; Škapa, S. Sustainable Investing Model for Decision Makers (Based On Research of Manufacturing Industry in the Czech Republic). Sustainability 2020, 12, 8342. https://doi.org/10.3390/su12208342

AMA Style

Kocmanová A, Dočekalová MP, Meluzín T, Škapa S. Sustainable Investing Model for Decision Makers (Based On Research of Manufacturing Industry in the Czech Republic). Sustainability. 2020; 12(20):8342. https://doi.org/10.3390/su12208342

Chicago/Turabian Style

Kocmanová, Alena, Marie P. Dočekalová, Tomáš Meluzín, and Stanislav Škapa. 2020. "Sustainable Investing Model for Decision Makers (Based On Research of Manufacturing Industry in the Czech Republic)" Sustainability 12, no. 20: 8342. https://doi.org/10.3390/su12208342

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