IDEAS home Printed from https://ideas.repec.org/a/dug/actaec/y2022i5p370-395.html
   My bibliography  Save this article

Are South African Socially Responsible Investment Funds Doing Well While Doing Good?

Author

Listed:
  • Faeezah Peerbhai

    (University of KwaZulu-Natal)

  • Jeremy Naidoo

    (University of KwaZulu-Natal)

Abstract

In recent years, the popularity of socially responsible investment (SRI) funds has soared as individuals are driven towards more environmentally and socially conscious investments. However, SRI funds could incur substantial costs whilst trying to comply with the principles of environmental, social and corporate governance (ESG). The question of financial performance is vital for investors who go beyond philanthropic affinities. The objective of this study is therefore to evaluate the riskadjusted performance of South African SRI funds relative to their conventional funds and respective passive benchmarks. To achieve this objective, the performance of 23 South African SRI funds is examined from January 2008 to December 2018 using the Fama and French 3-factor and Carhart 4- factor models. The results of this study indicate that SRI funds underperformed relative to non-SRI funds in earlier periods but outperformed or exhibited no significant performance difference in latter periods. This improved performance of SRI funds is attributed to the ‘learning effect’. The implications of this findings for South African investors are discussed further.

Suggested Citation

  • Faeezah Peerbhai & Jeremy Naidoo, 2022. "Are South African Socially Responsible Investment Funds Doing Well While Doing Good?," Acta Universitatis Danubius. OEconomica, Danubius University of Galati, issue 18(5), pages 370-395, October.
    • Handle: RePEc:dug:actaec:y:2022:i:5:p:370-395
    as

    Download full text from publisher

    File URL: https://dj.univ-danubius.ro/index.php/AUDOE/article/view/1864/2243
    Download Restriction: no
    ---><---

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:dug:actaec:y:2022:i:5:p:370-395. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Daniela Robu (email available below). General contact details of provider: https://edirc.repec.org/data/fedanro.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.