A Critical Analysis of Socially Responsible Investment (SRI): Meta-Debate and Development Perspectives

Abstract

Purpose

The aim of this chapter is to propose a critical analysis of socially responsible investing (SRI) through debate and reconstruction. Our goal is therefore to try to understand how the definition of ethics in finance has steered SRI towards a financial approach where ethics is guided by finance.

Methodology/approach

This chapter proposes a two-point approach consisting of a meta-debate and development perspectives. Each approach is divided into three debates (ideological and philosophical, scientific and practical), which are interconnected.

Findings

The chapter concludes that the debate on mainstream SRI is necessary but should be re-discussed, as it is preventing in its current form the concept from developing and being grounded in real ethical values, sacrificing the individual ethics that should be driving investing decisions.

Originality/value

The chapter proposes to rethink the paradigm around SRI through a conceptual framework that re-inserts finance within ethics, where non-financial performance and impact investment should be at the centre of the scientific debates, leading to an SRI based on exclusion, the consideration of controversies and social impact measurement.

Citation

Revelli, C. (2016), "A Critical Analysis of Socially Responsible Investment (SRI): Meta-Debate and Development Perspectives", Finance Reconsidered: New Perspectives for a Responsible and Sustainable Finance (Critical Studies on Corporate Responsibility, Governance and Sustainability, Vol. 10), Emerald Group Publishing Limited, Leeds, pp. 145-178. https://doi.org/10.1108/S2043-905920160000010026