Who is greener, more social and better-governed? Dual ownership by SRI mutual funds stands out

Robert Joliet and Yulia Titova

Economics Letters, 2024, vol. 243, issue C

Abstract: This study sheds new light on ESG performance and financial characteristics of companies that are constituents of portfolios of U.S. socially responsible investing (SRI) funds. We categorize SRI fund participation into three distinct types: debt-only, equity-only, and dual ownership of debt and equity. Companies with dual ownership tend to be held by relatively bigger and more concentrated SRI funds. Our holdings-based analysis reveals that these investee companies deliver superior ESG performance across all dimensions and have larger size, higher degree of financial safety, and higher profitability compared to those in equity-only or debt-only categories.

Keywords: Equity mutual funds; Fixed-income mutual funds; Socially responsible investments (SRI); Equity stake; Debt stake; ESG performance (search for similar items in EconPapers)
JEL-codes: G11 G14 G23 G34 M14 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:243:y:2024:i:c:s016517652400418x

DOI: 10.1016/j.econlet.2024.111934

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