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Screenings of Responsible Investments
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This chapter explains how socially responsible investing (SRI) has evolved in the last 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 utilisation of positive and negative screenings of listed businesses and public organisations. It also pr...
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... The first trend derived from the provided information is the extensive exploration of SRI and corporate sustainability by authors such as Aras andCrowther (2009), Auer (2016), Becchetti et al. (2015), Bugg-Levine and Emerson (2011), Camilleri (2020Camilleri ( , 2021, and Entine (2003). These studies cover a wide range of topics, including the evaluation and review of the SRI market, the impact of SRI policies on European stock portfolio value, comparative analyses of SRI in different regions, and the performance comparison of socially responsible and conventional investment funds, as well as the role of institutional investors in shareholder activism. ...
We studied the relationship between sustainable investment indexes and examine whether this relationship varies in bullish, bearish, and stable financial markets. To understand this issue more deeply, we analyzed the connectedness between three indexes—the Sustainable Impact investments, Paris-aligned stocks, and green bonds indexes—using the daily closing prices from 1 June 2017 to 15 April 2024, encompassing 1793 observations. We used a quantile vector autoregressive (QVAR) model to understand the dynamic relationship among the considered indices. The findings indicate that sustainable investments are strongly interconnected in both high and low quantiles, but this connection weakens significantly during periods of market stability. The Sustainable Impact investments and Paris-aligned stocks indexes are net transmitters of impacts to other sustainable alternatives, while the green bonds index is a net receiver. We also observed an increase in interconnectedness across all quantiles during the pandemic, the Russia–Ukraine military conflict, and changes in the European Union and the United States’ monetary policies.
... However, a socially responsible investment should not be equated solely to eliminating entities that do not follow social and environmental goals. It should be noted that these are also activities aimed at popularizing enterprises that emphasize social justice and environmental initiatives in the context of their investment activities [34] (pp. 14-17). ...
The content of this article relates to the widely considered issue of ESG investing, which has both theoretical and practical dimensions. The objective of this article is to verify whether there is a correlation between the implementation of ESG strategies and financial data and indicators. The first part of the discussion highlights the essence of a socially responsible investment—a concept that postulates the consideration of social responsibility in the functioning of companies. At a further stage, an attempt is made to systematize the concepts of ESG investing, where three key aspects are highlighted, i.e., environmental, social, and corporate governance. The article also refers to the reporting non-financial data, which are indicated by SASB standards. An empirical study is conducted on the UNIMOT Group. In this respect, the adjustment of ESG strategy directions with disclosure topics defined within the oil and gas midstream sector is analyzed. Then, using the GRETL econometric package, the relationship between the selected financial data is verified for the periods analyzed, with particular emphasis on the year of implementation of the ESG strategy, i.e., 2021. The conclusions and directions for further research are presented in the final section of the article.
... Throughout the history of investment, we have seen some interesting behavior of equity, whose reflection we will try to accommodate for socially responsible stocks by comparing them with the performance of general stock investments during times of crisis. Camilleri (2020) explains the evolution of socially responsible investing over the years and its relevance to present times. It outlines different forms of socially responsible investing in the financial market and explains the rationale behind the utilization of screening of businesses and public organizations. ...
Keywords: Socially responsible investing, ESG, Student’s T-test, ARCH, GARCH, performance, GREENEX, SENSEX, CARBONEX
This paper aims to examine and compare the effect of black swan events on the performance
of companies with strong Environmental, Social, and (Corporate) Governance (ESG)
backgrounds with that of other companies. Compared to established firms, companies with
ESG backgrounds are perceived to be stable that will help them outperform established
companies that are volatile during times of crisis. This research focuses on SENSEX for
conventional market index and BSE GREEENEX and S&P BSE CARBONEX for ESG
indices. We evaluated performances of the three indices during U.S. Debt Ceiling Crisis (2011-
12), Black Monday China, BREXIT and Demonetization (2015-16), and COVID-19 (2020)
crisis. We checked whether ESG indices outperformed conventional index significantly using
Student's T-test. We have also compared the volatility of the three indices during the different
black swan periods using the GARCH model.
