IDEAS home Printed from https://ideas.repec.org/p/chm/wpaper/wp2014-3.html
   My bibliography  Save this paper

Three myths about engagement and exclusion in responsible investment

Author

Listed:
  • Ivar Kolstad

Abstract

There is a move towards more use of engagement strategies in responsible investment. This change in strategies is motivated by a number of claims about the effectiveness of engagement versus exclusion of companies from the investment universe. This paper examines the basis for three central claims: i) That engagement, in contrast to exclusion, does not reduce the investment universe; ii) That exclusion reduces an investor’s influence on a company; and iii) That engagement with exclusion is necessarily a more effective means of influencing companies than pure exclusion. All three claims are argued to be open to challenge. It is possible that the move towards more engagement reflects bureaucratic incentives and political considerations among institutional investors, rather than arguments about the effectiveness and efficiency of engagement.

Suggested Citation

  • Ivar Kolstad, 2014. "Three myths about engagement and exclusion in responsible investment," CMI Working Papers 3, CMI (Chr. Michelsen Institute), Bergen, Norway.
  • Handle: RePEc:chm:wpaper:wp2014-3
    as

    Download full text from publisher

    File URL: https://www.cmi.no/publications/file/5151-three-myths-about-engagement-and-exclusion-in.pdf
    Download Restriction: no

    More about this item

    Keywords

    Responsible investment; engagement; exclusion; negative screening;

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    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:chm:wpaper:wp2014-3. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Robert Sjursen). General contact details of provider: http://edirc.repec.org/data/cmiiino.html .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.