Oct. 12, 2012
-- Elroy Dimson, A leverhume Emeritus Fellow at London Business School has won the 2012 Moskowitz Prize for Outstanding Research in the Field of SRI investing. Ten years of research and data that connects positive market performance with corporate social responsibility (CSR) has earned, Mr. Dimson and two other leading academics namely, Oguzhan Karakas, assistant professor, Carroll School of Management, Boston College; and Xi Li, assistant professor, Fox School of Business, Temple University, this prestigious award..
The Moskowitz Prize is a globally recognised prize that recognises initiatives made by companies in SRI Investing. Responsible investing impacts the sustainable, Responsible, Impact (SRI) Investment industry and gives the companies an understanding of the value of stakeholder activism and issues relating to corporate social Responsibility (CSR). The award is managed by the Berkeley-Haas Centre for responsible business and began in the year 1996.
CSR and SRI investing has become a large part of corporate finance organisations. It gives a positive image to the organisations and now is regarded as a focus area for major trading companies
Mr. Dimson said, “There is an increasing focus on Responsible Investing, especially among large institutions. For major investors, engagement is an important part of their strategy, and it is important to understand its impact. We are honoured to have our research on this topic recognised by this prestigious award".
Their paper, “active ownership” has produced results, which exhibits the average abnormal returns for a period of one year after initial investments. A vast difference can be seen between companies that have successful CSR Investments as compared to no returns for unsuccessful companies. Their research shows that CSR Engagements has created a steady shareholder value but not on the same level as stakeholder activism or hedge fund activism.
The firms used for the studies were publicly enlisted U.S. organisations and data was collected from the period of 1999-2009, on their environmental, social and governance issues. Corporate governance and climate change dominated in the positive outcomes. Thus, deducing that firms that were concerned about their reputation or had the ability to device CSR Changes were at the forefront of such engagements and consequently more successful in achieving their engagement goals.
Corporate finance firms may seek to promote themselves by getting involved in CSR engagements and thus improving on their operating performance, profitability, efficiency and governance indices, as was seen in the awarded paper for the selected firms.
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