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Journal of Business Ethics

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01-10-2014

Does Sustainability Investment Provide Adaptive Resilience to Ethical Investors? Evidence from Spain

Authors: Eduardo Ortas, José M. Moneva, Roger Burritt, Joanne Tingey-Holyoak

Published in: Journal of Business Ethics | Issue 2/2014

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Abstract

Although sustainable and responsible investment (SRI) has quite recently become a hot research topic, scarcely any systematic research has been paid to the performance of this non-conventional approach to investment during the financial crisis that emerged in mid-2008 when the resilience of the financial markets was sorely tested. Such real-world resilience in practice is the subject of the current research which tests whether environmental, social and governance screens provides ethical investors with adaptive resilience in bull and bear market conditions by focussing on the SRI equity index of one of the most active markets in Europe in terms of ethical investment, the FTSE4Good-Ibex in Spain. Multivariate Generalized Autoregressive Conditional Heteroskedasticity (M-GARCH) analysis indicates that ethical investors in the equity market examined with evidence that greater resilience in severe business cycle shocks could be attributable to SRI by companies. Although limited to a single country study, the results have implications for investors seeking resilience in crisis: when individual values and beliefs towards sustainability tie with personal investment strategy, the end result is adaptive financial resilience, social well-being and environmental defence.

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Title: Does Sustainability Investment Provide Adaptive Resilience to Ethical Investors? Evidence from Spain
Authors: Eduardo Ortas
José M. Moneva
Roger Burritt
Joanne Tingey-Holyoak
Publication date: 01-10-2014
Publisher: Springer Netherlands
Published in: Journal of Business Ethics / Issue 2/2014
Print ISSN: 0167-4544
Electronic ISSN: 1573-0697
DOI: https://doi.org/10.1007/s10551-013-1873-1

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