CEF.UP - FIN Seminar | Webinar - Sustainable Retail Investing: Motivations, Portfolio Consequences and the Role of ESG Ratings

Thursday, June 20th 2024 | 1:00 pm | room 305 | online

Sustainable Retail Investing: Motivations, Portfolio Consequences and the Role of ESG Ratings

Amir Amel-Zadeh  – Saïd Business School, Oxford University (England, United Kingdom)

“This study examines whether, how and to what effect wealthy retail investors use sustainability information in their investment decisions. Using a proprietary dataset of investment holdings of wealthy European retail investors, we exploit a quasi- exogenous shock to the coverage of sustainability ratings available to investors and document a plausibly causal effect of these ratings on investment allocations. We find the preference for assets with high sustainability ratings to stem from non-pecuniary motives and that sustainability is not perceived as a luxury good. We further find that “ESG-minded” investors hold significantly concentrated and under-diversified portfolios, over-allocate to home stocks and hold on longer to unrealised losses than “ESG-agnostic” investors. The former seem to achieve their objectives of investing in more sustainable firms that have fewer social and governance incidents but also overweight carbon-intensive sectors."

Any questions please contact cefup.sec@fep.up.pt.



Cef.up is financed by Portuguese public funds through FCT - Fundação para a Ciência e Tecnologia, I.P., in the framework of the project with reference UIDB/04105/2020