Investing for Change: Profit from Responsible Investment

Front Cover
The socially conscious citizen is uneasy today, as globalization seems to grind social standards ever lower, driving companies to search abroad for the lowest labor costs and forcing governments to reduce safety regulations to attract them. In this scenario, workers earn less, the environment suffers, tax revenues for health care and other social necessities fall lower and lower. Investing for Change shows that these citizens can change the globalized world in the direction of many common values by being a socially conscious investor. How can one invest according to one's values? Will it change the way companies act? In Investing for Change, Augustin Landier and Vinay B. Nair argue that in fact globalization, by lowering boundaries through instantaneous communications and providing individuals greater choices, is helping create a shared concern for many issues around the planet. No longer are such humanitarian concerns as workplace safety, environmental standards, health care, and child-labor protections limited to isolated nations in the developed world. This development gives Responsible Investing valuable practical force. After all, the authors write, companies should not be expected to put profits second, nor should investors be expected to pay a price to express their values. As the numbers of socially conscious investors rise—and as global pressure increases—companies will compete to maximize their appeal to these investors. Most exciting, the authors point to a new generation of financial products, based on the techniques of hedge funds, which will eliminate the cost of responsible investing. The world is changing—and it can change for the better, faster, with market-tested tools that promise real financial results. Categorizing investors in illuminating groups of Yellow, Blue, and Red, and drawing on the latest research and deep experience in asset management, Landier and Nair show how responsible investing can truly come into its own.
 

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Contents

A Natural Idea
1
2 Can SRI Achieve Change?
29
3 Profits or Values?
55
4 Values and Increased Profits?
75
5 Is SRI Sustainable?
105
6 Your Values
121
Appendix
147
Notes
149
Index
159
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About the author (2009)


Dr. Augustin Landier and Dr. Vinay B. Nair are co-founders of Ada Investment Management, an asset management firm based in New York City. They are also adjunct professors of finance at Stern School of Business, New York University. Previously they were Portfolio Managers and Research Directors at Old Lane, LP, Citi Alternative Investments as well as professors at the University of Chicago, The Wharton School, INSEAD and the Indian School of Business.

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