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The Performance of Socially Responsible Mutual Funds: The Role of Fees and Management Companies

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  • Javier Gil-Bazo

    ()

  • Pablo Ruiz-Verdú
  • André Santos

Abstract

In this paper, we shed light on the debate about the financial performance of socially responsible investment (SRI) mutual funds by separately analyzing the contributions of before-fee performance and fees to SRI funds' performance and by investigating the role played by fund management companies in the determination of those variables. We apply the matching estimator methodology to obtain our results and find that in the period 1997-2005, US SRI funds had significantly higher fees and better before- and after-fee performance than conventional funds with similar characteristics. Differences, however, were driven exclusively by SRI funds run by management companies specialized in socially responsible investment.

(This abstract was borrowed from another version of this item.)

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File URL: http://hdl.handle.net/10.1007/s10551-009-0260-4
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Bibliographic Info

Article provided by Springer in its journal Journal of Business Ethics.

Volume (Year): 94 (2010)
Issue (Month): 2 (June)
Pages: 243-263

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Handle: RePEc:kap:jbuset:v:94:y:2010:i:2:p:243-263

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Web page: http://www.springerlink.com/link.asp?id=100281

Related research

Keywords: socially responsible investment; mutual fund fees; mutual fund performance;

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References

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Citations

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Cited by:
  1. Janusz Brzeszczyński & Graham McIntosh, 2014. "Performance of Portfolios Composed of British SRI Stocks," Journal of Business Ethics, Springer, vol. 120(3), pages 335-362, March.
  2. Hooi Hooi Lean & Duc Khuong Nguyen, 2014. "Policy uncertainty and performance characteristics of sustainable investments across regions around the global financial crisis," Working Papers 2014-295, Department of Research, Ipag Business School.
  3. Miwa Nakai & Tomonori Honda & Nariaki Nishino & Kenji Takeuchi, 2013. "An Experimental Study on Motivations for Socially Responsible Investment," Discussion Papers 1314, Graduate School of Economics, Kobe University.
  4. Jonathan Goncalves, 2013. "Investissement socialement responsable : norme en devenir ou phénomène éphémère ?," Post-Print dumas-00934228, HAL.
  5. Iván Barreda-Tarrazona & Juan Matallín-Sáez & Mª Balaguer-Franch, 2011. "Measuring Investors’ Socially Responsible Preferences in Mutual Funds," Journal of Business Ethics, Springer, vol. 103(2), pages 305-330, October.
  6. Janusz Brzeszczynski & Graham McIntosh, 2012. "Performance of Portfolios Composed of British SRI Stocks," CFI Discussion Papers 1204, Centre for Finance and Investment, Heriot Watt University.
  7. Rathner, Sebastian, 2013. "The Relative Performance of Socially Responsible Investment Funds. New Evidence from Austria," Working Papers in Economics and Finance 2013-1, University of Salzburg.
  8. Sebastian Rathner, 2013. "The Influence of Primary Study Characteristics on the Performance Differential Between Socially Responsible and Conventional Investment Funds: A Meta-Analysis," Journal of Business Ethics, Springer, vol. 118(2), pages 349-363, December.

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