Socially Responsible Investments

A special issue of International Journal of Financial Studies (ISSN 2227-7072).

Deadline for manuscript submissions: closed (30 June 2020) | Viewed by 35198

Special Issue Editors


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Guest Editor
Department of Economics, Management and Business Law, University of Bari Aldo Moro, 70121 Bari, BA, Italy
Interests: social impact investments; corporate finance; financial markets
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Guest Editor
Economics Program, School of Social Sciences, Universiti Sains Malaysia, Penang 11800, Malaysia
Interests: financial economics; energy and environmental economics; Asia-Pacific and Chinese economics; applied statistics and econometrics
Special Issues, Collections and Topics in MDPI journals

Special Issue Information

Dear colleagues,

Socially responsible investing (SRI) is any kind of investment strategy which seeks to combine both financial return and social good. Currently, several US$ trillions are socially responsibly invested all over the world. The number of investors that avoid investing in unethical companies constantly increases. SRI has become an established way of investing both for institutional and private investors. The rapid growth of the SRI industry has fostered financial and economic studies, though with nonconclusive and often conflicting results. Moreover, many areas of SRI-related issues deserve further investigation.

This Special Issue aims at bridging this gap by collecting cutting-edge original papers that will improve the actual understanding of the SRI universe in all of its subsets (sustainable investing, impact investing, green finance, ethical investing, positive investing, community investing, etc.). Both theoretical and empirical papers are welcome. Case studies will be eligible for publication provided that they offer substantial comparisons and policy implications.

Submissions of scientific results from experts in academia and industry are strongly encouraged. The topics of interest include but are not limited to the following:

- Financial and economic literature on SRIs: where do we stay and where are we going;
- Innovative SR screening methodologies and portfolio choices;
- Innovative SR financial instruments, markets and institutions;
- SRI’s risk-adjusted performances and idiosyncratic volatility;
- Socially responsible asset management;
- Social capital: value and measurement;
- Information asymmetry and SRIs;
- Cultural environment and SRIs;
- Crises and SRIs;
- Socially responsible funds and bonds;
- Shareholder advocacy;
- Corporate socially responsible (CSR);
- Retail investors’ SRI preferences and expectations;
- International comparisons of SRIs markets, instruments, institutions, practices, processes, and performances.

Prospective authors are encouraged to contact the Guest Editors for feedback and comments about the topics of the research papers.

Prof. Fabio Pizzutilo
Prof. Hooi Hooi Lean
Guest Editors

Manuscript Submission Information

Manuscripts should be submitted online at www.mdpi.com by registering and logging in to this website. Once you are registered, click here to go to the submission form. Manuscripts can be submitted until the deadline. All submissions that pass pre-check are peer-reviewed. Accepted papers will be published continuously in the journal (as soon as accepted) and will be listed together on the special issue website. Research articles, review articles as well as short communications are invited. For planned papers, a title and short abstract (about 100 words) can be sent to the Editorial Office for announcement on this website.

Submitted manuscripts should not have been published previously, nor be under consideration for publication elsewhere (except conference proceedings papers). All manuscripts are thoroughly refereed through a single-blind peer-review process. A guide for authors and other relevant information for submission of manuscripts is available on the Instructions for Authors page. International Journal of Financial Studies is an international peer-reviewed open access quarterly journal published by MDPI.

Please visit the Instructions for Authors page before submitting a manuscript. The Article Processing Charge (APC) for publication in this open access journal is 1800 CHF (Swiss Francs). Submitted papers should be well formatted and use good English. Authors may use MDPI's English editing service prior to publication or during author revisions.

Published Papers (6 papers)

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Research

10 pages, 264 KiB  
Article
Dealing with Carbon Risk and the Cost of Debt: Evidence from the European Market
by Fabio Pizzutilo, Massimo Mariani, Alessandra Caragnano and Marianna Zito
Int. J. Financial Stud. 2020, 8(4), 61; https://doi.org/10.3390/ijfs8040061 - 13 Oct 2020
Cited by 20 | Viewed by 4226
Abstract
The ever-increasing attention towards climate change has led to investigate the economic and financial impact of environmental risk. In this scenario, we aimed at investigating the relationship between a specific component of environmental risk, namely the so-called carbon risk, and the cost of [...] Read more.
The ever-increasing attention towards climate change has led to investigate the economic and financial impact of environmental risk. In this scenario, we aimed at investigating the relationship between a specific component of environmental risk, namely the so-called carbon risk, and the cost of debt. This research is motivated by the fact that few studies have focused on the aforementioned relationship. We fill this gap by using a sample of companies listed on the Eurostoxx 600 Index. Our results evidence a positive relationship between carbon risk and cost of debt, providing a relevant contribution to the scarce existing literature on this topic. Full article
(This article belongs to the Special Issue Socially Responsible Investments)
20 pages, 1587 KiB  
Article
Financial and Economic Assessment of Tidal Stream Energy—A Case Study
by Stocker Klaus
Int. J. Financial Stud. 2020, 8(3), 48; https://doi.org/10.3390/ijfs8030048 - 4 Aug 2020
Cited by 4 | Viewed by 4062
Abstract
This case study is based on actual project and consultancy work, balancing real life experience with a review and analysis of empirical and theoretical literature. Tidal stream energy (TSE) is still a nascent technology, but with much better predictability than the classical alternatives [...] Read more.
This case study is based on actual project and consultancy work, balancing real life experience with a review and analysis of empirical and theoretical literature. Tidal stream energy (TSE) is still a nascent technology, but with much better predictability than the classical alternatives of sun and wind. Being still more expensive than other renewable technologies, it is important to find locations in order to initiate a learning process to bring down cost to a competitive level as it was the case for solar and wind technologies. Locations for an initial phase of operation of TSE small islands in the Philippines (and other Asian countries) were found to be most suitable, because expensive and polluting diesel generators can be replaced and a reliable 24 h electricity supply can be established. Different appraisal methods in different scenarios show that under normal circumstances a hybrid combination of TSE, solar energy and battery storage is financially and economically superior to existing fossil energy based power stations as well as to solar energy alone. However, the traditional financial approaches are not always reliable, in spite of superficial mathematical exactness, and the parameters used must be analysed carefully, especially if we deal with innovative technologies with fast changes. In times of global warming we must also include the controversial issue of evaluating damages from greenhouse gases if choosing fossil alternatives. When evaluating and planning renewable technologies, engineering know-how is important, but insufficient. Since financing is a crucial issue for most renewable technologies with high front loaded cost and long amortisation periods, a thorough and trustworthy financial and economic analysis is necessary not only to avoid financial failure later on, but also to attract stakeholders like private investors, banks and government institutions to support a still unknown technology. Full article
(This article belongs to the Special Issue Socially Responsible Investments)
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13 pages, 814 KiB  
Article
Socially Responsible Investing as a Competitive Strategy for Trading Companies in Times of Upheaval Amid COVID-19: Evidence from Spain
by Jesús Manuel Palma-Ruiz, Julen Castillo-Apraiz and Raúl Gómez-Martínez
Int. J. Financial Stud. 2020, 8(3), 41; https://doi.org/10.3390/ijfs8030041 - 6 Jul 2020
Cited by 43 | Viewed by 10728
Abstract
Sustainable and responsible investing (SRI) is a strategy that seeks to combine both financial return and social good. The need to create and preserve SRI represents a key argument in investment decision-making, which leads other firms and investors to make strategic decisions beyond [...] Read more.
Sustainable and responsible investing (SRI) is a strategy that seeks to combine both financial return and social good. The need to create and preserve SRI represents a key argument in investment decision-making, which leads other firms and investors to make strategic decisions beyond financial logic, based on environmental, social, and governance (ESG) factors. Within this framework, this paper aims to further clarify the understanding of potentially profitable strategies for firms during a global crisis such as a pandemic. Both primary and secondary data were gathered, and descriptive analyses were conducted. In Spain, several IBEX-35 companies announced donations amid the COVID-19 crisis. First, companies were classified into two groups based on donations made. For this, we searched for ESG online news. Then, profitability records amongst companies were identified and compared. In the trading session after the announcements, we found 12 of the 35 companies that made donations had a higher performance index of more than 2 and 3 points over the companies that did not make donations. With a weekly perspective, the difference was 91 and 60 basis points, respectively. These results suggest that in times of upheaval, investors base their strategy on ESG factors, contributing to the emerging literature on individual motives of SRI. Second, by conducting a survey and collecting data from 575 Spanish citizens, we conclude that after this crisis, people’s perceptions towards corporate social responsibility (CSR) will change, affecting consumption preferences in those companies that exhibited socially irresponsible or unsupportive behaviour. Hence, the reputation of firms, their social image, and social trust will play an important role in the near future. Full article
(This article belongs to the Special Issue Socially Responsible Investments)
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9 pages, 687 KiB  
Article
A Quantitative Model Supporting Socially Responsible Public Investment Decisions for Sustainable Tourism
by Aurora Skrame, Claudio Ciancio, Vincenzo Corvello and Roberto Musmanno
Int. J. Financial Stud. 2020, 8(2), 33; https://doi.org/10.3390/ijfs8020033 - 1 Jun 2020
Cited by 2 | Viewed by 2572
Abstract
The purpose of this article is to develop a quantitative model that supports policy makers in the tourism sector in making socially responsible investment decisions. In particular, this paper proposes a methodological approach to assess the impact of strategic decisions at the policy [...] Read more.
The purpose of this article is to develop a quantitative model that supports policy makers in the tourism sector in making socially responsible investment decisions. In particular, this paper proposes a methodological approach to assess the impact of strategic decisions at the policy level, in the field of tourism, from an economic, environmental and social point of view. The Calabria region, in Italy, has been chosen as a real-world case study. Based on historical data, the study identifies the main levers that influence tourism-related dynamics in Calabria. A quantitative forecasting model to support future investment decisions for sustainable tourism has then been developed. This problem is modeled through a multi-criteria optimization framework. To initialize such a framework, a non-linear autoregressive network with exogenous inputs (NARX) has been used. The proposed model is a flexible instrument to evaluate public investment policies in the field of tourism from the point of view of sustainability and social responsibility. Full article
(This article belongs to the Special Issue Socially Responsible Investments)
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15 pages, 297 KiB  
Article
The Role of ‘Digitalization’ in German Sustainability Bank Reporting
by Florian Diener and Miroslav Špaček
Int. J. Financial Stud. 2020, 8(1), 16; https://doi.org/10.3390/ijfs8010016 - 9 Mar 2020
Cited by 10 | Viewed by 4565
Abstract
The financial services sector, particularly with respect to today’s banking industry, is aiming to make a digital transition. Sustainable reporting is a holistic new reporting approach in banking and has only become partially mandatory for the sector. Thus, this paper makes a contribution [...] Read more.
The financial services sector, particularly with respect to today’s banking industry, is aiming to make a digital transition. Sustainable reporting is a holistic new reporting approach in banking and has only become partially mandatory for the sector. Thus, this paper makes a contribution to the current analysis approach and further development of the German Sustainability Code as well as associated legal approaches. It concerns the assessment of mandatory sustainable reporting in the light of constantly changing market conditions and stricter legal requirements for stakeholder data responsibility. In specific, it focuses on a digital evolving business environment and is intended to provide an insight into the perception of the topic of digitalization in the banking sector. The assessment is based on the structure of the German Sustainability Code. Based on 113 bank reports, a multiple regression analysis of 1410 codings of the keyword ‘digital’ is carried out. The results show that banks partly and not fully address digital issues in their reporting. It transpires that the emphasis is on seven criteria, while social elements are totally ignored. The paper shows a structural inequality within sustainable bank reporting with regard to digitalization. It also shows that issues are not adequately addressed and covered in legal reporting standards and that the provision of information to stakeholders on specific issues is largely undefined. Full article
(This article belongs to the Special Issue Socially Responsible Investments)
16 pages, 708 KiB  
Article
Comparing the Influence of Green Credit on Commercial Bank Profitability in China and Abroad: Empirical Test Based on a Dynamic Panel System Using GMM
by Xiaoling Song, Xin Deng and Ruixue Wu
Int. J. Financial Stud. 2019, 7(4), 64; https://doi.org/10.3390/ijfs7040064 - 1 Nov 2019
Cited by 19 | Viewed by 8092
Abstract
This study establishes a dynamic panel model for 12 Chinese-listed commercial banks and seven international commercial banks. More specifically, it examines the impact of green credit on the profitability of commercial banks and the differences between China and other countries while using the [...] Read more.
This study establishes a dynamic panel model for 12 Chinese-listed commercial banks and seven international commercial banks. More specifically, it examines the impact of green credit on the profitability of commercial banks and the differences between China and other countries while using the generalized method of moments. The research shows that the Equatorial Principles project-financing ratio of international banks positively affects bank profitability, while the ratio of green credit for Chinese commercial banks is inversely related to their profitability. Further, a comparative study of China and other countries highlights that the green credit business is at significantly different stages in China and the rest of the world. This study also finds that the profitability of China’s banking sector is positively affected by asset size, management expense ratio, cash ratio, and GDP growth rate, in addition to the common influencing factor of non-performing loan ratio, whereas asset size and capital adequacy ratio negatively affects the international banking sector. Drawing on these empirical conclusions, this study offers suggestions for the further development of green credit in Chinese commercial banks. Full article
(This article belongs to the Special Issue Socially Responsible Investments)
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