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Investors' aspirations toward social impact: a portfolio-based analysis

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Title: Investors' aspirations toward social impact: a portfolio-based analysis
Authors: Boni, L
Toschi, L
Fini, R
Item Type: Journal Article
Abstract: In the last ten years, we have witnessed a proliferation of investors claiming blended value strategies, i.e., pursuing both economic and social returns in their investments. Aside from this rush for self-selecting in a blended value finance context, we still do not know to what extent the investors’ claims actually reflect investment decisions. Evidence suggests that, in some cases, such investors tend to maximize the social performance over the financial performance; in some others, the effect is reverted, but literature currently lacks studies aligning the analysis of the investment decisions with the investment portfolios. Yet, it is still unclear whether blended value investment decisions are enacted as a result of investors’ deliberate strategies and what influences this relationship. In this paper we tackle this issue, analyzing the extent to which investors’ finance firms pursuing goals aligned with their strategic aspirations. Specifically, adopting a Fractional Logistic Regression model, we test the effect of investors’ aspirations toward social impact on the extent to which their investees (i.e., the portfolio of firms in which they invest) pursue social returns. Results suggest the existence of a positive and significant investor–portfolio alignment effect (i.e., the higher the investors’ aspirations toward social impact, the higher the number of investees with higher social aspirations). Yet, this effect is influenced by contingencies at both investor and portfolio levels. Investors with strong aspirations toward social impact that: (i) invest in countries with high levels of social inequality, and (ii) are located in countries that support social progress and maximize, in their portfolios, the presence of businesses pursuing social impact. We discuss implications for future researchers, policymakers and practitioners.
Issue Date: 10-May-2021
Date of Acceptance: 10-Mar-2021
URI: http://hdl.handle.net/10044/1/91359
DOI: 10.3390/su13095293
ISSN: 2071-1050
Publisher: MDPI AG
Journal / Book Title: Sustainability
Volume: 13
Issue: 9
Copyright Statement: © 2021 by the authors.Licensee MDPI, Basel, Switzerland.This article is an open access articledistributed under the terms andconditions of the Creative CommonsAttribution (CC BY) license (https://creativecommons.org/licenses/by/4.0/)
Keywords: Science & Technology
Life Sciences & Biomedicine
Green & Sustainable Science & Technology
Environmental Sciences
Environmental Studies
Science & Technology - Other Topics
Environmental Sciences & Ecology
impact investing
blended value
alignment
aspirations
HYBRID ORGANIZATIONS
VENTURE CAPITALISTS
INVESTMENT
ENTREPRENEURSHIP
DIVERSIFICATION
SUSTAINABILITY
RESPONSIBILITY
INTERPLAY
FIRMS
SCOPE
Science & Technology
Life Sciences & Biomedicine
Green & Sustainable Science & Technology
Environmental Sciences
Environmental Studies
Science & Technology - Other Topics
Environmental Sciences & Ecology
impact investing
blended value
alignment
aspirations
HYBRID ORGANIZATIONS
VENTURE CAPITALISTS
INVESTMENT
ENTREPRENEURSHIP
DIVERSIFICATION
SUSTAINABILITY
RESPONSIBILITY
INTERPLAY
FIRMS
SCOPE
12 Built Environment and Design
Publication Status: Published
Article Number: ARTN 5293
Appears in Collections:Imperial College Business School



This item is licensed under a Creative Commons License Creative Commons