Does it really hurt to be responsible?

Humphrey, Jacquelyn E. and Tan, David T. (2014) Does it really hurt to be responsible?. Journal of Business Ethics, 122 3: 375-386. doi:10.1007/s10551-013-1741-z

Author Humphrey, Jacquelyn E.
Tan, David T.
Title Does it really hurt to be responsible?
Journal name Journal of Business Ethics   Check publisher's open access policy
ISSN 0167-4544
Publication date 2014-06-01
Year available 2013
Sub-type Article (original research)
DOI 10.1007/s10551-013-1741-z
Open Access Status Not yet assessed
Volume 122
Issue 3
Start page 375
End page 386
Total pages 12
Place of publication Dordrecht, Netherlands
Publisher Springer
Language eng
Abstract Prior literature on socially responsible investment has contended that excluding "sin stocks" from a portfolio (negative screening) will reduce performance and increase risk. Further, incorporating stocks of firms with positive social responsibility scores (positive screening) will improve performance and reduce risk. We simulate portfolios designed to mimic typical equity mutual funds' holdings and investigate these propositions. We remove the potentially confounding influences of differences in manager skill, transaction costs and fees, and conduct a clean experiment on the effect of positive and negative portfolio screening. We find no difference in the return or risk of screened and unscreened portfolios. We conclude that a typical socially responsible fund will neither gain nor lose from screening its portfolio.
Keyword Ethical investing
Mutual funds
Socially responsible investing
Q-Index Code C1
Q-Index Status Confirmed Code
Institutional Status Non-UQ
Additional Notes Published online: 15 May 2013.

Document type: Journal Article
Sub-type: Article (original research)
Collections: Non HERDC
UQ Business School Publications
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Citation counts: TR Web of Science Citation Count  Cited 6 times in Thomson Reuters Web of Science Article | Citations
Scopus Citation Count Cited 6 times in Scopus Article | Citations
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Created: Fri, 21 Feb 2014, 01:07:36 EST by Ms Jacquelyn Humphrey on behalf of UQ Business School