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SRI Funds: Investor Demand, Exogenous Shocks and ESG Profiles

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Abstract

We provide evidence that investor demand for socially responsible or sustainable and responsible (SRI) mutual funds differs from that of conventional funds in that flows to SRI funds have shown greater growth and more persistence than flows to conventional funds. More importantly, using a differences-in-differences approach we provide evidence that these attributes appear to result from investors’ nonfinancial considerations. However, as these funds have become more mainstream, there has been convergence in investor resilience. We also find a high level of persistence in SRI funds' ESG profiles, which are generally different from those of conventional funds, consistent with their charters.

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  • Jędrzej Białkowski & Laura T. Starks, 2016. "SRI Funds: Investor Demand, Exogenous Shocks and ESG Profiles," Working Papers in Economics 16/11, University of Canterbury, Department of Economics and Finance.
    • Handle: RePEc:cbt:econwp:16/11
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    More about this item

    Keywords

    Socially responsible investment funds; Mutual fund flows; Investor clienteles; Investment screens; Environmental; Social and Governance (ESG) investing;
    All these keywords.

    JEL classification:

    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors

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