Socially Responsible Investing: An Evolving Concept in a Changing World
Author(s)
Kinder, Peter D.; Lydenberg, Steven D.; Domini, Amy L.
Abstract
“Socially responsible investing” (SRI) as a term, has become unfavorably viewed because of differing views of what this phrase is and means. This analysis centers on three fundamental questions:1) What meanings attach to “socially responsible investing” today? 2) Who are SRI’s constituents and what are (and will be) their objectives and methodologies? 3) How do financial and social performance relate to and interact with its constituents’ objects? I begin by describing how SRI came to mean different things to different investors. I then classify the approaches termed SRI and analyze the sources of the dissonance among the approaches in terms of their social, legal and political characteristics. I conclude that the differences, while real, should not prevent SRI’s constituents from making common cause on issues of corporate accountability and – in its broadest sense – corporate governing.
