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The performance of social responsible investing from retail investors' perspective: international evidence

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  • Guillermo Badía
  • Luis Ferruz
  • Maria Céu Cortez

Abstract

This paper investigates the performance of socially responsible investment (SRI) portfolios compared to conventional investments. Adopting a retail investor's perspective, we provide evidence of SRI financial performance at the worldwide level as well as at the regional level, for five regions (North America, Europe except UK, UK, Pacific region and emerging markets). Our results show that the performance of global SRI portfolios is higher than conventional investments. Moreover, we observe differences in the financial performance of regional SRI portfolios in the overall period and, in particular, in bear markets. These results suggest that country‐specific factors may affect the relationship between corporate social and financial performance.

Suggested Citation

  • Guillermo Badía & Luis Ferruz & Maria Céu Cortez, 2021. "The performance of social responsible investing from retail investors' perspective: international evidence," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 26(4), pages 6074-6088, October.
    • Handle: RePEc:wly:ijfiec:v:26:y:2021:i:4:p:6074-6088
    DOI: 10.1002/ijfe.2109
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    2. Guillermo Badía & Fernando Gómez‐Bezares & Luis Ferruz, 2022. "Are investments in material corporate social responsibility issues a key driver of financial performance?," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 62(3), pages 3987-4011, September.

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