Socially Responsible Investment and Fiduciary Duty: Putting the Freshfields Report into Perspective [Book Review]
David Bourget (Western Ontario)
David Chalmers (ANU, NYU)
Rafael De Clercq
Jack Alan Reynolds
Learn more about PhilPapers
Journal of Business Ethics 101 (1):143-162 (2011)
A critical issue for the future growth and impact of socially responsible investment (SRI) is whether institutional investors are legally permitted to engage in it – in particular whether it is compatible with the fiduciary duties of trustees. An ambitious report from the United Nations Environment Programme’s Finance Initiative (UNEP FI), commonly referred to as the ‘Freshfields report’, has recently given rise to considerable optimism on this issue among proponents of SRI. The present article puts the arguments of the Freshfields report into some further both empirical and critical perspective, however, and suggests that its findings do not call for very much optimism. The general argument is that while the understanding of fiduciary duty outlined by the Freshfields report seems to allow institutional investors to at least sometimes take some social or environmental considerations into account, the support it gives for SRI is notably contingent and, furthermore, it rules out exactly the kind of SRI which proponents of social responsibility and environmental sustainability should hold in highest regard – proactive cases and socially effective investment strategies. If SRI is to become an important force for corporate social responsibility through its adoption by institutional investors, then, it is suggested that legal reform is needed.
|Keywords||ethical investment fiduciary duty Fresh-fields report institutional investors legal reform prudent investor rule social effectiveness socially responsible investment United Nations Environment Programme Finance Initiative|
|Categories||categorize this paper)|
Setup an account with your affiliations in order to access resources via your University's proxy server
Configure custom proxy (use this if your affiliation does not provide a proxy)
|Through your library|
References found in this work BETA
Matthew Haigh & James Hazelton (2004). Financial Markets: A Tool for Social Responsibility? [REVIEW] Journal of Business Ethics 52 (1):59-71.
Richard Hudson (2009). Ethical Investing. Business Ethics Quarterly 15 (4):641-657.
Carmen Juravle & Alan Lewis (2008). Identifying Impediments to Sri in Europe: A Review of the Practitioner and Academic Literature. [REVIEW] Business Ethics 17 (3):285–310.
Alan Lewis & Carmen Juravle (2010). Morals, Markets and Sustainable Investments: A Qualitative Study of 'Champions'. [REVIEW] Journal of Business Ethics 93 (3):483 - 494.
Alan Lewis & Craig Mackenzie (2000). Support for Investor Activism Among U.K. Ethical Investors. Journal of Business Ethics 24 (3):215 - 222.
Citations of this work BETA
James J. Angel & Douglas McCabe (2013). Ethical Standards for Stockbrokers: Fiduciary or Suitability? [REVIEW] Journal of Business Ethics 115 (1):183-193.
Craig A. Zabala (2013). Review of Dilemmas in Responsible Investment by Céline Louche and Steve Lydenberg. [REVIEW] Business and Society Review 118 (1):135-141.
Similar books and articles
George R. Gay (2003). Fiduciary Duty and Socially Responsible Investing. Philosophy in the Contemporary World 10 (1):49-54.
Shuangge Wen (2009). Institutional Investor Activism on Socially Responsible Investment: Effects and Expectations. Business Ethics 18 (3):308-333.
William Martin (2009). Socially Responsible Investing: Is Your Fiduciary Duty at Risk? [REVIEW] Journal of Business Ethics 90 (4):549 - 560.
Christopher J. Cowton & Joakim Sandberg (2012). Socially Responsible Investment. In Ruth Chadwick (ed.), Encyclopedia of Applied Ethics, 2nd ed. Academic Press.
Josep M. Lozano, Laura Albareda & M. Rosario Balaguer (2006). Socially Responsible Investment in the Spanish Financial Market. Journal of Business Ethics 69 (3):305 - 316.
Douglas Cumming & Sofia Johan (2007). Socially Responsible Institutional Investment in Private Equity. Journal of Business Ethics 75 (4):395 - 416.
Mark Jonathan Rhodes (2010). Information Asymmetry and Socially Responsible Investment. Journal of Business Ethics 95 (1):145 - 151.
Neil Stuart Eccles (2010). UN Principles for Responsible Investment Signatories and the Anti-Apartheid SRI Movement: A Thought Experiment. [REVIEW] Journal of Business Ethics 95 (3):415 - 424.
Russell Sparkes & Christopher J. Cowton (2004). The Maturing of Socially Responsible Investment: A Review of the Developing Link with Corporate Social Responsibility. [REVIEW] Journal of Business Ethics 52 (1):45-57.
Jonathan McLachlan & John Gardner (2004). A Comparison of Socially Responsible and Conventional Investors. Journal of Business Ethics 52 (1):11-25.
Jonas Nilsson (2008). Investment with a Conscience: Examining the Impact of Pro-Social Attitudes and Perceived Financial Performance on Socially Responsible Investment Behavior. [REVIEW] Journal of Business Ethics 83 (2):307 - 325.
Donald H. Schepers (2006). Some Observations on the Global Practice of Socially Responsible Investment. Proceedings of the International Association for Business and Society 17:164-169.
Pietra Rivoli (2003). Making a Difference or Making a Statement? Finance Research and Socially Responsible Investment. Business Ethics Quarterly 13 (3):271-287.
Peter Waring & John Lewer (2004). The Impact of Socially Responsible Investment on Human Resource Management: A Conceptual Framework. Journal of Business Ethics 52 (1):99-108.
Elias Bengtsson (2008). A History of Scandinavian Socially Responsible Investing. Journal of Business Ethics 82 (4):969 - 983.
Added to index2011-07-04
Total downloads24 ( #100,557 of 1,696,342 )
Recent downloads (6 months)4 ( #137,999 of 1,696,342 )
How can I increase my downloads?