The risk of SIN or socially irresponsible stocks

Alireza Rezaeian and Marie Racine ()
Additional contact information
Alireza Rezaeian: University of Saskatchewan
Marie Racine: University of Saskatchewan

Review of Quantitative Finance and Accounting, 2024, vol. 62, issue 2, No 11, 755-798

Abstract: Abstract We demonstrate that the current practice of assuming SIN stocks are riskier than non-SIN stocks is misleading for SIN, or socially irresponsible, investments in alcohol, tobacco and gambling securities. Using annual North American data from 1980 to 2017, we investigate the risk of SIN stocks relative to that of a curated sample of non-SIN firms with similar characteristics and carefully matched using propensity score methodology. Our results show, with the lone exception of idiosyncratic risk of gambling stocks, it is hard to find a category in which the risk of SIN stocks is significantly greater than that of their matched non-SIN counterparts. Further, we find that risk is changing over time, is SIN category dependent and the ability of Corporate Social Responsibility to mitigate risk is also category sensitive.

Keywords: SIN stocks; Socially irresponsible stocks; Risk; Corporate social responsibility; Propensity score matching (search for similar items in EconPapers)
JEL-codes: G00 G11 G19 M14 (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1007/s11156-023-01220-w Abstract (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:kap:rqfnac:v:62:y:2024:i:2:d:10.1007_s11156-023-01220-w

Ordering information: This journal article can be ordered from
http://www.springer.com/finance/journal/11156/PS2

DOI: 10.1007/s11156-023-01220-w

Access Statistics for this article

Review of Quantitative Finance and Accounting is currently edited by Cheng-Few Lee

More articles in Review of Quantitative Finance and Accounting from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().