ethical strategy focus and mutual fund management performance and persistence abstract the aim of this study is to analyze whether managers practitioners and individual investors could obtain higher risk adjusted returns by allocating their investments to funds that integrate specific levels of socially responsible sr criteria in their portfolios this is achieved by comparing the performance of mutual funds according to their sr characteristics environmental governance social and sustainability attributes for a large sample of 3920 equity sr mutual funds around the world performance is measured using a multifactor model that incorporates relevant benchmarks according to the fund investment objectives and using carhart s 1997 methodology to measure mutual fund performance persistence in general fund performance is not significant the average being negative and close to zero funds achieving relatively high levels of sr attributes in their portfolios seem to experience overall worse performances this evidence is however mainly driven by the behavior of worst performing funds moreover investing in the previous best sr funds could lead investors to greater overall returns in most areas and levels of sr attributes considered this evidence highlights the role of managers in enhancing the returns of a portfolio with a well defined sr investment policy therefore there is no incompatibility between pursuing higher ethical and sustainable values as well as greater financial performances from investments provided managers have the skills necessary to choose the right sr funds

a test for subadditivity of the cost function with an application to the bell system stable url http links jstor org sici sici 0002 8282 28198409 2974 3a4 3c615 3aatfsot 3e2 0 co 3b2 rthe american economic review is currently published by american economic association your use of the jstor archive indicates your acceptance of jstor s terms and conditions of use available athttp www jstor org about terms html jstor s terms and conditions of use provides in part that unless you have obtainedprior permission you may not download an entire issue of a journal or multiple copies of articles and you may use content inthe jstor archive only for your personal non commercial use please contact the publisher regarding any further use of this work publisher contact information may be obtained athttp www jstor org journals aea html each copy of any part of a jstor transmission must contain the same copyright notice that appears on the screen or printedpage of such transmission the jstor archive is a trusted digital repository providing for long term preservation and access to leading academicjournals and scholarly literature from around the world the archive is supported by libraries scholarly societies publishers and foundations it is an initiative of jstor a not for profit organization with a mission to help the scholarly community takeadvantage of advances in technology for more information regarding jstor please contact support jstor org http www jstor orgmon jul 2 16 52 19 2007

putting sustainable investing into practice a governance framework for pension funds this article presents a framework intended to provide pension funds with practical guidance for the successful implementation of a sustainable investing strategy the framework is developed with respect to the uk and us pension funds as these share certain common legal characteristics and focuses on the changes that pension funds adopting such a strategy should make to their investment strategies and governance particularly through the formulation and articulation of clear investment mission and strong investment beliefs the article proceeds with a review of socially responsible investment sri and more recent responsible investment ri literature in the context of growing public awareness but not necessarily understanding of the concept of sustainability literature review of sri field sri ri and sustainable investing section it then examines the literature on pension fund governance arguing the need for more detailed practical guidance for funds moving towards sustainable investing especially for those implementing a sustainable investing strategy anglo american pension fund governance section it presents the framework for the practical implementation of sustainable investing in the sustainable investing framework section finally we review the relevant anglo american legal backdrop outlining how pension funds adopting our framework should approach their fiduciary obligations and then discussing potential regulatory enablers of sustainable investment legal context barriers to and enablers of sustainable investing section

the financial performance of a socially responsible investment over time and a possible link with corporate social responsibility this paper empirically examines the financial performance of a uk unit trust that was initially conventional and later adopted socially responsible investment sri principles ethical investment principles comparison is made with three similar conventional funds whose investment objectives remained unchanged analysis techniques employed in previous studies find similar results mean risk adjusted performance is unchanged by the switch to sri with no evidence of over or under performance relative to the benchmark market index by any of the four funds more interestingly changes in variability of returns over time are also modelled using generalised autoregressive conditional heteroscedasticity models not previously applied to sri funds so far as is known results show a temporary increase in variability of returns followed by a return to previous levels after around 4 years evidence shows the increased variability to be associated with the adoption of sri rather than with a change in fund management possible explanations for the subsequent reduction in variability include the spread of corporate social responsibility activities by firms and learning by fund managers in addition to reporting on a previously unobserved phenomenon this paper raises questions for further research

a century of research on agricultural markets this article provides a perspective on major innovations in research on agricultural markets over the past century we review research on market structure and performance vertical coordination arrangements and institutions for producer collective action contributions to empirical modeling of agricultural price determination and marketing margins are also evaluated as are innovations in research on spatial market relationships and the role of storage finally we discuss contributions to understanding market information systems and the functioning of market based mechanisms for agri

can socially responsible investment for cleaner production improve the financial performance of spanish pension plans abstract assets under management involved in socially responsible investing almost trebled from 2007 to 2011 in europe led by pension funds such growth has encouraged the implementation of socially responsible activities by companies which have improved their cleaner production methods in order to reduce greenhouse gas emissions total water used energy consumption and waste generated among others integrating environmental social and governance policies for cleaner production into the investment strategy of pension plans could increase their cost deriving from the screening process and or increase the benefits because socially responsible companies in which pension funds invest might achieve a better financial performance than traditional companies which could in turn affect pension plans financial performance for this reason the aim of this paper is two fold firstly to examine the financial performance of spanish pension plans compared to market benchmarks taking into account the category to which they belong and the socially responsible business strategy implemented by the manager and secondly to analyze whether differences in financial performance exist between solidarity pension plans ethical pension plans and traditional pension plans to do this we have a sample of 651 individual system pension plans using these sample data we implement the robust random effects panel data methodology the results show that ethical pension plans which invest in companies that improve their cleaner production methods achieve a similar financial performance to conventional pension plans while solidarity pension plans significantly outperform conventional pension plans

how can a ratings based method for assessing corporate social responsibility csr provide an incentive to firms excluded from socially responsible investment indices to invest in csr socially responsible investment sri indices play a major role in the stock markets a connection between doing good and doing well in business is implied leading indices such as the domini social index and others exemplify the movement toward investing in socially responsible corporations however the question remains does the ratings based methodology for assessing corporate social responsibility csr provide an incentive to firms excluded from sri indices to invest in csr not in its current format the ratings based methodology employed by sri indices in their selection processes excludes many corporations by creating limited membership lists this received ratings based structure is yet to offer an incentive for most of the excluded corporations to invest in improving their levels of csr we therefore ask under what circumstances a ratings based method for assessing csr could provide an incentive to firms excluded from sri indices to invest in csr in this article we attempt to offer a theoretical reply to this question we show that when all firms are publicly ranked according to sri index parameters such indices can indeed create a market incentive for increased investment by firms in improving their performance in the area of social responsibility we further show that this incentive tapers off as the amount of investment required exceeds a certain point or if the amount of payback on that investment fails to reach a certain threshold

modelling cost structure the bell system revisited this paper analyses a recent public policy decision and the crucial role played by the choice of the functional form the break up of the bell system is indeed a classic case of anti trust settlement and constitutes one of the most prominent and controversial applications of microeconomics to public policy it is argued that demanding multi output cost properties such as economies of scope for this is the considerable robustness problem displayed by the tranlog cost functional form the reason for this is the considerable able to robustness problem displayed by the translog cost function which is the source underlying many of the expert disagreements it is suggested that the non robustness is due to what ils termed the flip flop property and it is shown that the available empirical evidence from the pre divestiture bell system supports this argument to obtain robust results we propose that the analysis is constrained to the proper region of the cost function we propose that the analysis is con

sustainability in mining minerals and energy new processes pathways and human interactions for a cautiously optimistic future the supply of minerals and energy is critical to global society however this supply is associated with social and environmental impacts leading to concerns of generational and intergenerational equity in light of these concerns a call for papers for a special volume on the mining industry was issued with the view that such academic work could assist in reducing the negative impacts associated with this industry this paper introduces the special volume the sustainability agenda of the minerals and energy supply and demand network an integrative analysis of ecological ethical economic and technological dimensions the special volume contains 84 articles divided into several themes sustainability accounting and reporting corporate social responsibility future mining challenges integrative frameworks for sustainability management aspects mining in a developing context and new frontiers in the oil and gas industry the special volume also includes two letters on contemporary issues with commentaries on these from experts in the fields viz community conflict and land rehabilitation insights obtained across these themes are summarized and recommendations are made of what is needed to build upon the findings of this special volume a research agenda is proposed for the future from the gaps and synergies identified the overall contribution of this special volume is that it renews the debate on the sustainability challenges for the mining industry and provides transdisciplinary insights into resolving some of these challenges

socially responsible investment a multicriteria approach to portfolio selection combining ethical and financial objectives abstract in a context of socially responsible investment sri this paper deals with portfolio selection for investors interested in ethical policies in the opportunity set there are ethical assets and other assets which are not characterized as ethical two goals are considered the traditional financial goal in the classical utility theory under uncertainty and an ethical goal in the same utility framework a new financial ethical bi criteria model is proposed with absolute risk aversion coefficients and targets depending on the investor s ethical profile this approach is relevant as an increasing number of mutual funds are becoming interested in sri strategies from the proposed model an actual case on green investment is developed concerning this case without generalizing to other contexts an analysis of the numerical results shows that efficient portfolios obtained by the traditional e v model outperform the strong green portfolios in terms of expected return and risk but this does not significantly occur with weak green investment

the heterogeneity of socially responsible investment many writers have commented on the heterogeneity of the socially responsible investment sri movement however few have actually tried to understand and explain it and even fewer have discussed whether the opposite standardisation is possible and desirable in this article we take a broader perspective on the issue of the heterogeneity of sri we distinguish between four levels on which heterogeneity can be found the terminological definitional strategic and practical whilst there is much talk about the definitional ambiguities of sri we suggest that there is actually some agreement on the definitional level there are at least three explanations which we suggest can account for the heterogeneity on the other levels cultural and ideological differences between different regions differences in values norms and ideology between various sri stakeholders and the market setting of sri discussing the implications of the three explanations for the sri market we suggest that there is reason to be sceptical about the possibilities of standardisation if not standardisation is imposed top down whether this kind of standardisation is desirable or not we argue depends on what the motives for it would be to the extent that standardisation may facilitate the mainstreaming of sri it could be a good thing but we entertain doubts about whether mainstreaming really requires standardisation

sustainability indexes why join in a study of the corporate sustainability index ise in brazil abstract in the past decade indicators have been created to assess the sustainability performance of companies listed in stock exchange markets academics and practitioners expect companies to benefit from being listed in such indexes but evidence of value creation is still scarce since virtually all studies about the corporate sustainability index ise of the sao paulo stock exchange brazil the object of the present study focused on the value of shares we initially looked for answers in the finance theory we collected secondary data about the financial and economic performance of companies forming the ise s theoretical portfolio as these kinds of indexes are also known in a second stage we sought additional motivations for companies to make efforts to be listed in the index we collected additional data and interviewed representatives of key companies listed in the ise as well as industry leaders who chose not to participate in the selection process the results support the main propositions of the institutional theory as well as the pays to be green literature that the intangible value created by voluntary environmental initiatives such as access to knowledge new capabilities and reputational gain better explain the efforts companies make to be listed in the ise index

the message and methods of ethical investment abstract this paper examines a high profile and often provocative segment of the financial industry that of ethical or socially responsible investment by offering an ethical or sustainable product which has the potential to influence so many stakeholders the financial industry is in a unique position to guide change towards corporate sustainability however what message is ethical investment really giving to companies and the financial industry are ethical investors and their rating agencies capable of effectively influencing corporations towards more sustainable patterns of production and consumption and are their approaches consistent with the principles of cleaner production this paper first gives an overview some of the definitions ethical investment and the scale of activities under this umbrella term then the actual screening methods and their application is examined a typology of the different ethical mutual funds is given and two cases of ethical funds are described robur s environmental fund and sustainable asset management s sustainability rating tool each are analysed in terms of their potential to either reveal or conceal cleaner production innovations by the firms they assess in order to ascertain where ethical investment might lead companies the effects of ethical investment on companies and back on the asset management companies themselves is explored a reflexive model of corporate and finance sector learning based on the ethical screens is proposed

unnatural monopolies in local telephone we attempt to overcome the serious data problems of past telecommunications cost studies by focusing on local exchange carriers lecs with enough degrees offreedom to yield precise estimates our global subadditivity tests show that the cost function is definitely not subadditive the results suggest that the benefits to breaking up the monopoly outputs of existing lecs substantially outweigh the potential losses in efficiency they also support permitting entry and increasing competition in local exchange markets furthermore given the competitive nature of long distance service it is doubtful that the predivestiture bell system was a natural monopoly

a social capital paradox entrepreneurial dynamism in a small world clean technology cluster abstract clean tech entrepreneurs have struggled to gain investor confidence because of some particular characteristics and circumstances of the industry this research combines network and sustainable development literature in the clean tech context to support the logic of a new investment approach that may stimulate sustainable investing in clean tech theory is proposed to suggest that there may be an advantageous social capital paradox where strong ties in a cluster lead to dynamism rather than decay the clean tech industry provides a context where strong ties offer network stability in a small world cluster such that it is a value creating organizational form offering greater dynamism two related propositions are developed to support the social capital paradox they lead to a theoretical conclusion that long term integrated partner solutions where partners are also resource constrained lead to successful alliances supporting a dynamic cluster that will grow over time a practical conclusion is that investing in a connected cluster of firms might be less risky compared to investing in a new firm or even a portfolio of well diversified assets de risking clean production investments may be achievable through a small world network cluster backed security

decomposing technical change within the conventional neoclassical framework a distinction is sometimes made between productaugmenting and factor augmenting technical change a parallel distinction is commonly made between embodied and disembodied technical change with the former associated with factor and the latter with product augmentation disembodied change is commonly assumed to arise from increases in the stock of knowledge independently of the characteristics of the inputs used while embodied change relates to increases in the efficiency of inputs that is labor skills or the productivity of physical capital unfortunately this distinction is ambiguous changes in the efficiency of the inputs used are usually accompanied indeed made possible by increases in knowledge and conversely increases in the stock of knowledge often favor some inputs more than others including the capital goods of one vintage relative to those of another notwithstanding the ambiguity the concept of embodiment has intuitive appeal and this partly explains the focus on decomposing the sources of technical change that followed solow s 6 seminal paper but by the late 1960s a reader of the literature might have concluded that such decomposition was impossible for with merely time series data on inputs and output product augmenting and factor augmenting technical change are empirically indistinguishable in an important paper hall 3 showed that with data on used equipment prices and the interest rate embodied technical change and the deterioration function can in principle be calculated however the paucity of data on the price of used capital goods has allowed little progress in this direction the new longitudinal research database created by the u s bureau of the census now permits still another approach to the estimation of embodied technical change associated

labour and capital saving technical change in telecommunications the australian telecommunications sector is being improved and extended through substantial recent investment in intelligent technology such as digital switching fibre optics satellite and cellular transmission and the internet these technologies are being progressively integrated with technology from the broadcasting computer and electronics industries providing a unified information infrastructure for information transmission and processing technological progress embodied in new equipment has the effect of increasing the efficiency of the factors of production such efficiency increases can be biased towards a particular factor for instance the impact of labour augmenting technical change is a decline in the cost of labour per unit of production when such biases are apparent the relativity between the costs of labour and capital per unit of production is changed in the longer term technical change can impact on the rate of employment growth and also on the rate of capital accumulation in th

socially responsible investing in the united states 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 unitedstates 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

corporate sustainability ratings an investigation into how corporations use the dow jones sustainability index abstract the purpose of this paper is to explore the use of the dow jones sustainability index djsi with an emphasis on canadian corporations the paper provides insight into the use of the djsi in several areas including the use of its logo the steps taken by corporations to achieve initial acceptance to the index and the steps corporations take to maintain their inclusion in the djsi a content analysis of publicly available information from 24 canadian corporations listed in the djsi north america djsina showed that less than half of those sampled used the djsi logo in their sustainability reports or on their websites the majority of the published references to the djsi were in highlighting corporate achievements or in providing background information on the index a survey of 10 experts from the canadian corporations listed in the djsina revealed a wide range of strategies for gaining and maintaining inclusion in the index particularly involving a large number of internal stakeholders in responding to data requests and working with third parties several suggestions for improving the djsi were also provided including streamlining the questionnaire improving coordination among sustainability ratings agencies and enhancing transparency

growth accounting when technical change is embodied in capital this paper revisits the hypothesis that technical change is embodied in capital it extends old results to make them more relevant to the contemporary debates about the adjustment of investment goods for quality change and about the role of embodied technical change as a source of economic growth it is shown that the failure to adjust capital for quality change has the effect of suppressing the quality effects into the conventional total factor productivity residual and it is found that approximately 20 percent of the residual growth of quality adjusted output could be attributed to embodied technical change copyright 1992 by american economic association