Engagement Dialogue as a Nordic Sustainable and Responsible Investment (SRI) Strategy

Lars G. Hassel () and Natalia Semenova ()
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Lars G. Hassel: University of Gävle
Natalia Semenova: Linnaeus University

A chapter in Challenges in Managing Sustainable Business, 2019, pp 179-204 from Springer

Abstract: Abstract This chapter explores engagement dialogue as a sustainable and responsible investment (SRISustainable and responsible investments (SRI)) strategy from a NordicNordic investor perspective. The Nordic model of engagement dialogue is grounded in the Nordic model of corporate governance and stakeholder capitalism. Based on a proprietary database from a professional SRI agent, this chapter conducts an in-depth analysis of engagement dialogue between Nordic institutional investorsInstitutional investors and MSCI World companies regarding environmental, social, and corruption risks. The main characteristics of the NordicNordic model of engagement dialogue are an incident-based approach, norm-based compliance, a small number of engagement cases, and long-term emphasis on risk reduction as opposed to short-term financial gains. The chapter notes that successful forms of engagement dialogue target global companies with higher levels of pre-engagement environmental, social and governance (ESG) performance, ESG transparency, and operating performance than a matched sample. Their performance remains superior to the matched sample in the post-engagement period. The chapter consequently extends previous literature on SRI strategies in the Anglo-Saxon model of activism based on shareholder resolutions, whereby companies are targeted owing to corporate governance risks and low financial performance.

Keywords: Sustainable and responsible investments (SRI); Investor activism; Private engagements; Environmental; social and governance (ESG) risks; Transparency; Performance (search for similar items in EconPapers)
Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-319-93266-8_8

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DOI: 10.1007/978-3-319-93266-8_8

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