NDLI: How Can a Ratings-based Method for Assessing Corporate Social Responsibility (CSR) Provide an Incentive to Firms Excluded from Socially Responsible Investment Indices to Invest in CSR?

Content Provider	Springer Nature Link
Author	Adam, Avshalom Madhala Shavit, Tal
Copyright Year	2007
Abstract	Socially Responsible Investment (SRI) indices play a major role in the stock markets. A connection between doing good and doing well in business is implied. Leading indices, such as the Domini Social Index and others, exemplify the movement toward investing in socially responsible corporations. However, the question remains: Does the ratings-based methodology for assessing corporate social responsibility (CSR) provide an incentive to firms excluded from SRI indices to invest in CSR? Not in its current format. The ratings-based methodology employed by SRI indices in their selection processes excludes many corporations by creating limited-membership lists. This received ratings-based structure is yet to offer an incentive for most of the excluded corporations to invest in improving their levels of CSR. We, therefore, ask under what circumstances a ratings-based method for assessing CSR could provide an incentive to firms excluded from SRI indices to invest in CSR. In this article, we attempt to offer a theoretical reply to this question. We show that when all firms are publicly ranked according to SRI index parameters, such indices can indeed create a market incentive for increased investment by firms in improving their performance in the area of social responsibility. We further show that this incentive tapers off as the amount of investment required exceeds a certain point or if the amount of payback on that investment fails to reach a certain threshold.
Starting Page	899
Ending Page	905
Page Count	7
File Format	PDF
ISSN	01674544
Journal	Journal of Business Ethics
Volume Number	82
Issue Number	4
e-ISSN	15730697
Language	English
Publisher	Springer Netherlands
Publisher Date	2007-11-10
Publisher Place	Dordrecht
Access Restriction	One Nation One Subscription (ONOS)
Subject Keyword	corporate social responsibility social responsible investment ethical investment corporate social performance financial performance theory of SRI Quality of Life Research Management/Business for Professionals Economic Growth Ethics
Content Type	Text
Resource Type	Article
Subject	Arts and Humanities Business and International Management Law Economics and Econometrics

Sl.	Authority	Responsibilities	Communication Details
1	Ministry of Education (GoI), Department of Higher Education	Sanctioning Authority	https://www.education.gov.in/ict-initiatives
2	Indian Institute of Technology Kharagpur	Host Institute of the Project: The host institute of the project is responsible for providing infrastructure support and hosting the project	https://www.iitkgp.ac.in
3	National Digital Library of India Office, Indian Institute of Technology Kharagpur	The administrative and infrastructural headquarters of the project	Dr. B. Sutradhar bsutra@ndl.gov.in
4	Project PI / Joint PI	Principal Investigator and Joint Principal Investigators of the project	Dr. B. Sutradhar bsutra@ndl.gov.in Prof. Saswat Chakrabarti will be added soon
5	Website/Portal (Helpdesk)	Queries regarding NDLI and its services	support@ndl.gov.in
6	Contents and Copyright Issues	Queries related to content curation and copyright issues	content@ndl.gov.in
7	National Digital Library of India Club (NDLI Club)	Queries related to NDLI Club formation, support, user awareness program, seminar/symposium, collaboration, social media, promotion, and outreach	clubsupport@ndl.gov.in
8	Digital Preservation Centre (DPC)	Assistance with digitizing and archiving copyright-free printed books	dpc@ndl.gov.in
9	IDR Setup or Support	Queries related to establishment and support of Institutional Digital Repository (IDR) and IDR workshops	idr@ndl.gov.in

Ethical requirement and financial interest: A literature review on socially responsible investing

The performance of socially responsible investment funds: A meta-analysis

Socially Responsible Investment in the Spanish financial market

The Influence of Primary Study Characteristics on the Performance Differential Between Socially Responsible and Conventional Investment Funds: A Meta-Analysis

The Financial Performance of a Socially Responsible Investment Over Time and a Possible Link with Corporate Social Responsibility

Which Dimensions of Social Responsibility Concern Financial Investors?

The ethical finance as a response to the financial crises: an empirical survey of European SRFs performance

Is There a Gold Social Seal? The Financial Effects of Additions to and Deletions from Social Stock Indices

SRI funds: Nomen est omen

How Can a Ratings-based Method for Assessing Corporate Social Responsibility (CSR) Provide an Incentive to Firms Excluded from Socially Responsible Investment Indices to Invest in CSR?

Similar Documents

Ethical requirement and financial interest: A literature review on socially responsible investing

The performance of socially responsible investment funds: A meta-analysis

Socially Responsible Investment in the Spanish financial market

The Influence of Primary Study Characteristics on the Performance Differential Between Socially Responsible and Conventional Investment Funds: A Meta-Analysis

The Financial Performance of a Socially Responsible Investment Over Time and a Possible Link with Corporate Social Responsibility

Which Dimensions of Social Responsibility Concern Financial Investors?

The ethical finance as a response to the financial crises: an empirical survey of European SRFs performance

Is There a Gold Social Seal? The Financial Effects of Additions to and Deletions from Social Stock Indices

SRI funds: Nomen est omen

How Can a Ratings-based Method for Assessing Corporate Social Responsibility (CSR) Provide an Incentive to Firms Excluded from Socially Responsible Investment Indices to Invest in CSR?