Analysing Socially Responsible Investing (SRI) fund flows reveals the underlying motivations driving SRI investors’ decisions. However, fund flow analysis is fraught with endogeneity issues and the standard solutions (eg Instrumental Variables and GMM) are difficult to construct. A quasi-natural experiment therefore represents an ideal alternative solution: i.e. a longitudinal sequence of exogenous Environmental, Social and Governance (ESG) shocks. Highly publicised ESG events are likely to motivate the choice of SRI investments over more conventional investments. This article systematically measures the timing, magnitude and distributional characteristics of media coverage following each major ESG event. The resulting series provides a robust device for mitigating the interference of confounding patterns when analysing fund flows.
23 Oct 2019
Environmental Social & Governance for Sustainability Colloquium