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10.5593/sgemsocial2017/15/S05.109

SOCIALLY RESPONSIBLE INVESTMENTS: METHODOLOGY, RISK, EFFICIENCY

O. Danilova
Thursday 28 September 2017 by Libadmin2017

References: 4th International Multidisciplinary Scientific Conference on Social Sciences and Arts SGEM 2017, www.sgemsocial.org, SGEM2017 Conference Proceedings, ISBN 978-619-7408-17-1 / ISSN 2367-5659, 24 - 30 August, 2017, Book 1, Vol 5, 871-878 pp, DOI: 10.5593/sgemsocial2017/15/S05.109

ABSTRACT

This paper explores the literature on social investment. Social investment is a form of implementing social responsibility and investment in human development. The effect of social investment is determined by the quality of life and has comprehensive direction for the development of social reproduction, because the system of social investment in its parameters beyond national interests. We provide empirical evidence of the influence of social preferences on formation of the investment portfolio of large Russian companies. The results of our research show that the period of consideration of social expenditures solely as an investment in accordance with personal values and ethics changes (not as fast as required by the reality) recognition of investment in human capital as the most effective investment of our time. Russian investors yet possible to assess whether a company is responsible in its dealings with its employees, customers, the local community and the environment. This is due to the low information transparency of the majority of Russian companies. We see that social preferences systematically affect the selection of the portfolio of large corporations. This fact is explained by the fact that social preferences, not the risk-profitability ultimately affect long-term business strategy of major Russian companies. Model of social investment are investigated through the application of enterprise risk management techniques. Social investing allows you to neutralize the risks (technological, financial, political, social) that are in the information age society threatened by global instability and uncertainty. The company that aims to beat the competition, send significant funds on various forms of social investment and get a huge competitive advantage. The lack of safe working conditions leading to accidents in the production, violation of environmental regulations. All of this is litigation and reputational risks, and results in losses associated with damages to injured workers and their rehabilitation. Social investment is considered as a public institution, which does not depend on legal regulations and voluntary decision of the investor taken under the influence of a combination of circumstances (economic environment, the stability of the political situation in the society, the presence of transformational trends in the economy).

Keywords: socially responsible investments, ethical investing, social risks, public institution, model of social investment