Corporate social responsibility: The investor's perspective

Abstract

Investors are increasingly realising that a proactive approach to the management of a firm's social and environmental risks can result in considerable opportunities in both financial and sustainable value creation. This trend is being reflected in a significant increase in the number of corporations that are involved in what is called 'Responsible Investment' (RI) - that is approaches which integrate environmental, social, governance and ethical factors into investment processes. This chapter explores the investor's perspective of the field of corporate social responsibility and more specifically on the practice of Responsible Investment (RI). The aim is threefold: firstly to provide a general background on Responsible Investment - definition, history, actors and trends, secondly, to give an overview of the existing practices of responsible investment and its key characteristics and finally to discuss some critical issues that may shape the future of RI. RI is still a developing and changing activity which is expected to keep growing in the future. But responsible investors can play a major role in transforming the concept of investing by integrating social and environmental dimensions whilst simultaneously pushing up the issue in a company's CSR agenda. © 2010 Springer-Verlag Berlin Heidelberg.