Screening US mutual funds for social responsibility and irresponsibility

This study examines 139 socially responsible and 4,898 conventional U.S. mutual funds from 2013–2020, analyzing social responsibility and irresponsibility by screening fund holdings. SR funds show higher weighted ESG ratings and subscores than conventional funds but underperform regarding corporate scandals, driven by social and governance issues, with no significant differences in environmental scandals. Passive SR funds tend to show higher weighted ESG scores than active SR funds. The findings offer valuable insights for ethical investors and fund managers to enhance investment strategies and decision-making. • We examine dimensions of social responsibility and irresponsibility of U.S. socially responsible mutual funds compared to conventional funds. • SR mutual funds demonstrate a higher level of weighted ESG ratings and ESG subscores compared to conventional funds. • SR mutual funds underperform in the context of corporate scandals. • This underperformance is driven by social- and governance-related scandals, while no significant differences are observed for environmental scandals. • Both SR and conventional funds demonstrate score persistence over the short and long term.

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Publication Details

Journal
Finance research letters
Published
2025-11-24
DOI
https://doi.org/10.1016/j.frl.2025.109002
Primary Topic
Corporate Social Responsibility Reporting
Type
article
Field-Weighted Citation Impact
0.00
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article

Screening US mutual funds for social responsibility and irresponsibility

Christian Kreuzer, Jakob Artinger
Finance research letters
Corporate Social Responsibility Reporting
article

Screening US mutual funds for social responsibility and irresponsibility

Christian Kreuzer, Jakob Artinger
article en

Abstract

This study examines 139 socially responsible and 4,898 conventional U.S. mutual funds from 2013–2020, analyzing social responsibility and irresponsibility by screening fund holdings. SR funds show higher weighted ESG ratings and subscores than conventional funds but underperform regarding corporate scandals, driven by social and governance issues, with no significant differences in environmental scandals. Passive SR funds tend to show higher weighted ESG scores than active SR funds. The findings offer valuable insights for ethical investors and fund managers to enhance investment strategies and decision-making. • We examine dimensions of social responsibility and irresponsibility of U.S. socially responsible mutual funds compared to conventional funds. • SR mutual funds demonstrate a higher level of weighted ESG ratings and ESG subscores compared to conventional funds. • SR mutual funds underperform in the context of corporate scandals. • This underperformance is driven by social- and governance-related scandals, while no significant differences are observed for environmental scandals. • Both SR and conventional funds demonstrate score persistence over the short and long term.

Finance research lettersVol. 87
University of Regensburg (DE), Deutsche Bundesbank (DE)
Openalex Percentile: Top 49%
Corporate Social Responsibility Reporting
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