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The demographic profile of socially responsible investors

Author

Listed:
  • Joan C. Junkus
  • Thomas C. Berry

Abstract

Purpose - Given the size and growing importance of socially responsible (SR)-related funds and investments, the purpose of this paper is to see if those who invest in socially responsible investments (SRIs) conform to a particular profile and if that profile is significantly different than that of a typical investor. Design/methodology/approach - This study surveyed a large group of US-based, well-informed, individual investors, members of the American Association of Individual Investors. The survey respondents included both those who invest according to SRI principles, and those with no interest in SRI, to determine if demographic differences exist. Findings - The paper finds that the typical SR investor is female and more likely to be single, younger, less wealthy, and better educated than their non-SR counterparts. Research limitations/implications - Further research is needed to determine if the higher risk aversion of women and their greater concern for the environment found in previous studies is responsible for the results. Practical implications - Given the statistically significant differences, additional efforts must be made to convince wealthier and male investors of the merits of socially responsible investing. Originality/value - This is the first paper to use individuals who have committed resources to SR to compare their demographic characteristics to investors who have not invested in SRI products as distinct groups. Second, this is the first study to compare these groups using US investor data and to measure the statistical significance of the demographic factors.

Suggested Citation

  • Joan C. Junkus & Thomas C. Berry, 2010. "The demographic profile of socially responsible investors," Managerial Finance, Emerald Group Publishing, vol. 36(6), pages 474-481, May.
  • Handle: RePEc:eme:mfipps:v:36:y:2010:i:6:p:474-481
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    References listed on IDEAS

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    1. Beal, Diana & Goyen, Michelle, 1998. "'Putting Your Money Where Your Mouth Is' A Profile of Ethical Investors," Financial Services Review, Elsevier, vol. 7(2), pages 129-143.
    2. Brad M. Barber & Terrance Odean, 2001. "Boys will be Boys: Gender, Overconfidence, and Common Stock Investment," The Quarterly Journal of Economics, Oxford University Press, vol. 116(1), pages 261-292.
    3. Palsson, Anne-Marie, 1996. "Does the degree of relative risk aversion vary with household characteristics?," Journal of Economic Psychology, Elsevier, vol. 17(6), pages 771-787, December.
    4. Diamantopoulos, Adamantios & Schlegelmilch, Bodo B. & Sinkovics, Rudolf R. & Bohlen, Greg M., 2003. "Can socio-demographics still play a role in profiling green consumers? A review of the evidence and an empirical investigation," Journal of Business Research, Elsevier, vol. 56(6), pages 465-480, June.
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    Citations

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    Cited by:

    1. Gunnar Gutsche & Bernhard Zwergel, 2016. "Information barriers and SRI market participation – Can sustainability and transparency labels help?," MAGKS Papers on Economics 201624, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    2. 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.
    3. Anett Wins & Bernhard Zwergel, 2016. "Comparing those who do, might and will not invest in sustainable funds: a survey among German retail fund investors," Business Research, Springer;German Academic Association for Business Research, vol. 9(1), pages 51-99, April.
    4. Gregor Dorfleitner & Mai Nguyen, 2016. "Which proportion of SR investments is enough? A survey-based approach," Business Research, Springer;German Academic Association for Business Research, vol. 9(1), pages 1-25, April.
    5. Thomas Berry & Joan Junkus, 2013. "Socially Responsible Investing: An Investor Perspective," Journal of Business Ethics, Springer, vol. 112(4), pages 707-720, February.
    6. Maria Cristina Rossi & Dario Sansone & Costanza Torricelli & Arthur van Soest, 2018. "Household Preferences for Socially Responsible Investments," Centro Studi di Banca e Finanza (CEFIN) (Center for Studies in Banking and Finance) 18021, Universita di Modena e Reggio Emilia, Dipartimento di Economia "Marco Biagi".

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