New Study Wins Prize: Stock Market May Put Higher Value on
Environmentally-Responsible Companies
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http://www.socialfunds.com/news/release.cgi/4482.html
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(CSRwire) BERKELEY, Calif.- The 2005 Moskowitz Prize for Socially
Responsible Investing has been awarded to a new study which claims that the
stock market could provide a higher value to companies rated above-average
on environmental issues.
The Prize is awarded by the Center for Responsible Business Center at the
Haas School of Business, in cooperation with the Social Investment Forum,
which promotes the concept, practice and growth of socially responsible
investing.
The study - entitled "The Economic Value of Corporate Eco-Efficiency" -
found that "company managers do not face a tradeoff between eco-efficiency
and financial performance, and that investors can use environmental
information for investment decisions." The study examined a long-running
debate about environmental versus financial performance by focusing on the
concept of eco-efficiency, a measure developed by Innovest Strategic Value
Advisors. Full text of the 2005 winning paper is available online at:
http://papers.ssrn.com/sol3/papers .cfm?abstract_id=675628.
"This study is important to help investors, managers, and policy-makers to
understand the crucial question the extent to which environmentally-friendly
technologies and products are profitable," said David Levine, professor of
economics at the Haas School of Business and one of the Moskowitz Prize
judges. "The results are clear: the stock market provides a higher value to
companies that Innovest rates as above-average on environmental issues,"
added Levine.
Lloyd Kurtz, who is known as the "guiding spirit" behind the Moskowitz Prize
and is a senior portfolio manager at Nelson Capital Management, an
investment advisory affiliate of Wells Fargo, added: "We are delighted to
recognize the strong work of this team from The Netherlands. With this
award, two of the co-authors of this study - Rob Bauer and Kees Koedijk -
become the first two-time winners of the Moskowitz Prize in its 10-year
history. This underscores the growing importance and influence of European
researchers in the ongoing debate about SRI."
Nadja Guenster, Jeroen Derwall, Rob Bauer, and Kees Koedijk authored the
study. Guenster, Derwall, and Koedijk - are affiliated with the Rotterdam
School of Management at Erasmus University, and Bauer is affiliated with
Limburg Institute of Financial Economics at Maastricht University.
Co-authors Bauer and Koedijk are also past winners of the Prize, for the
2002 paper "International Evidence on Ethical Mutual Fund Performance and
Investment Style".
An honorable mention was awarded to Dr. Meir Statman for his study "Socially
Responsible Indexes: Composition, performance, and tracking errors", which
is forthcoming in the Journal of Portfolio Management. Dr. Statman, of the
Leavey School of Business at Santa Clara University, is a well-recognized
financial researcher specializing in Behavioral Finance. He has another SRI
article, "The Religions of Social Responsibility", headlining the latest
issue of The Journal of Investing.