Ethical Investmen: A Study of Performance of Mutual Funds

Ankido Tariq Borissov & Kris Holmberg Degn

Student thesis: Master thesis


Over the last decade we see huge interest and growth in sustainable and ethic investments, it seems to grow even more in the future. Actors within the ethics area says that the future investment only will be ethic and sustainable. ESG – environmental, social and governance describes areas that characterize a sustainable responsible or ethical investment. ESGinvestors seek positive returns and long-term impact on society, environment, and the performance of the business. This study exercises the question many investors may have; do the ESG investments perform better than the conventional investments? We analyze the performance of 41 ethic funds, which are compared with 41 identical conventional funds in the period 2007-2018. We match de ethics funds with conventional funds within age, size and investment style. We further study the performance of the funds, when the market is under pressure and if age, size and investment style have an impact on the performance. Furthermore, we compare both ethical and conventional funds with the S&P 500 index. The results show both the ethical and conventional funds underperform compared to the S&P 500 index and there are small differences between the ethical and conventional funds, but the ethical funds show better performance, when the market is under pressure.

EducationsMSc in Finance and Accounting, (Graduate Programme) Final Thesis
Publication date2019
Number of pages123