The Expressive Nature of Socially Responsible Investors

Abstract

Socially responsible investors attempt to integrate their ethical, societal and religious values with their investments. They find it impossible to separate the utilitarian characteristics of an investment, namely its risk and expected returns, from its expressive characteristic of social responsibility.

Not all values are shared by all investors and not all socially responsible investors are alike, but socially responsible investors find meaning in those words and that meaning is often lost in noisy debates between advocates of socially responsible investing and its detractors.

I present here a few socially responsible investors in their own quiet words. They tell us about their ethical, societal and religious goals and about the experiences that led them to their goals. They also tell us about their investments and their efforts to further their goals beyond their investments. We listen to a nun saying that the most important issue to her order is human rights and human dignity, a video producer telling of the need to balance her desire for socially responsible investing with her financial reality, a student telling of growing up wealthy and awakening to social responsibility by encounters with poor children, and the owner of military related companies arguing that SRI should be about supporting companies that have the best policies and practices rather than companies whose products we like.

Keywords: socially responsible investing, investor behavior, behavioral finance

JEL Classification: G11, G12