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The purpose of this paper is to compare the financial performance of green and traditional mutual funds in the USA.

A total of 131 green mutual funds identified by US SIF, were compared with the averages of all traditional mutual funds in their respective Morningstar categories. Performance measures analyzed included annualized rates of return, expense ratios, and Sharpe ratios, among others. Most data pertained to at least the past three years, while other data pertained to the most recent 5 to 15 years.

The results demonstrate that green mutual funds have generated lower returns and similar risks compared to traditional mutual funds in their respective Morningstar categories. Green mutual funds have underperformed on a risk‐adjusted basis.

Since there is no formal definition of a green mutual fund, the researcher and investor must make a subjective call in assessing which funds invest “green”. However, at least in this early stage in the history of green investing, green mutual funds have underperformed their peers.

Results confirm the limitations of green investing as suggested by various researchers, among them Sharpe, Rudd and Kurtz and DiBartolomeo. Results stand in contrast to Corson and Van Dyck and Statman, among others, which reported no significant underperformance for socially responsible investments.

Purpose: Ethical investing is considered to be the pinnacle of embedding environmental considerations in investing. Environmental considerations form a major part of corporate social responsibility (CSR), and CSR is considered to have a positive effect on investment returns. The purpose of this chapter is to assess the degree of environmental considerations embedded in faith-based funds investment criteria. The comparative analysis between principles and practice through faith-based investing is undertaken.

Design/Methodology: Prospectuses of selected faith-based mutual funds and other information around investment strategies provided on the Funds’ websites have been analyzed in detail. Content analysis has been undertaken in order to evaluate the existence and types of environmental related criteria demonstrated by the Funds. The criteria are compared to the faith principles on environmental responsibility.

Findings: It is generally assumed that CSR requirements form the premise of socially responsible investing. The authors find that faith-based investing criteria are narrowly defined and that they represent biases which do not promote environmentally responsible investing.

Implications: The major implication is that inspite of the availability of faith-based environmental responsibility principles, faith-based funds represent a case of economic returns prioritization over environmental considerations. Environment accountability principles that exist need to be promoted regularly so that they become an essential element of every day decision-making including faith-based economic decision-making.

Originality: This study contributes to the debate on ethical investing from the perspective of faith-based mutual funds.

Socially responsible investment (SRI) has gained importance as about one out of eight US dollars is currently invested based on screening in the USA. However, European private investors are generally much more reluctant to invest in shares, and in Austria, only 7 percent of private households hold shares. There is nevertheless some interest in “green shares” (a sub‐class of SRI comprising shares that are screened for their least impact on the environment) as a representative survey recently exhibited that 8 percent of respondents were definitely interested in holding “green shares”. Econometric estimates of an empirical model explaining the respondents' willingness to invest in green shares showed that education, income, environmental awareness and the expected profit are the main explanatory variables. Based on these results, conclusions are drawn regarding marketing strategies for “green shares”. In particular, credibility both regarding financial aspects (competitive return), and environmental and social criteria have to be guaranteed to make more consumers interested in investing in green shares.

To study these issues, the authors chose a GFSC with one producer and one material supplier as research object, the supplier will offer green material to the producer and the producer will make green food using green production technology. Then, the authors proposed that consumers' perceived value was determined by the trustworthiness levels of the related green and quality-safety information provided by the supplier and the producer. Then, considering the trustworthiness levels of the green and quality information provided by the supplier and the producer, the authors improved the demand function. Afterwards, we constructed four investment models and their income models are built and then a cost-sharing and revenue-sharing contract (hereafter, CSRS) was adopted to coordinate the GFSC.

With the growth of consumers environmental awareness and life level, consumers' requirements for green and high quality food are growing. In recently years, to increase consumers' perceived trustworthiness on the product greenness and quality levels, stakeholders in green food supply chain (hereafter, GFSC) start to adopt the blockchain-based traceability system (hereafter, BLTS). For investors, they need to know the investment conditions and how to coordinate the GFSC.

(1) When the revenue-sharing coefficient is less than three-fourths and higher then a certain vaule, the cost-sharing and revenue-sharing contract can make the GFSC coordinate. (2) The investment cost threshold of the BLTS has a positive relationship with the trustworthiness improvement levels of the green and quality information, the green degree of food products and the quality of food products. (3) In the proposed four investment situations, as the growth of consumers perceived credibility coefficient about the greenness information and the quality information, chain members' revenues will increase. In addition, comparing with co-investing the BLTS, benefits of chain members are lower than them in the sole investment model.

(1) The demand function we proposed can help chain members forecast market demand to support production or ordering decisions. (2) The investment decision policies can offer a theoretical reference for chain members to use the BLTS. (3) The CSRS will offer the theoretical reference for coordinating the supply chain after using the BLTS. Furthermore, our study method can be referenced by other scholars. (4) The study method can offer a method reference for researchers who do a similar discussion in a manufacturing supply chain. Although, our research cannot guide the industrial practices, it can serve as a reference of the similar research in industry.

This study aims to highlight the key aspects of sustainable finance using bibliometric analysis of the relevant literature extracted from two separate databases, Scopus and Dimensions.ai. The present study contributes towards the achievement of sustainable development by providing directions to align financial decision-making with different sustainability aspects.

The author conducted bibliometric analysis for 1,220 articles from Scopus and 1,437 publications from Dimensions.ai. The most frequently occurring terms in sustainable finance research are explored and visualised using the VOSviewer.

Bibliometric findings revealed a dynamic evolution of research focus over time. The social component dominated from 2012 to 2016, however a shift to environmental and climate change considerations is noticed from 2016 to 2020. Recent studies (2020–2022) exhibited heightened attention to green finance and renewable energy. Overlay visualisations highlighted similar trends in both databases, indicating a contemporary emphasis on green finance.

This study enriches theoretical discourse by mapping the trajectory of sustainable finance research, contributing to a deeper understanding of its evolution.

Insights from this study guide researchers and practitioners in identifying trends, that can help the integration of green finance principles into corporate strategies.

Findings also raise awareness among stakeholders, and help facilitate socially responsible corporate cultures and informed policymaking.

The originality of this study lies in its comprehensive bibliometric analysis of sustainable finance research in management studies, drawing data from two major databases and spanning over three decades.

Increasing focus on socially responsible investments (SRIs) and green projects in recent times, coupled with the arrival of COVID pandemic, are the main drivers of this study. The authors conduct a post-factum analysis of investor choice between sin and green investments before and through the COVID outbreak.

A passive investor is introduced who seeks maximum risk-adjusted return and/or investment variance. When presented an opportunity to add sin and/or green investments to her initial one-asset market-only investment position, she views and handles this issue as a portfolio problem (MPT). She estimates value-at-risk (VaR) and conditional-value-at-risk (CVaR) for portfolios to account for downside risk.

Green investments offer better overall risk-return optimization in spite of major inter-period differences in return-risk dynamics and substantial downside risk. Portfolios optimized for minimum variance perform just as well as the ones optimized for minimum downside risk. Return and risk have settled at higher levels since the onset of COVID, resulting in shifting the efficient frontier towards north-east in the return-risk space.

The study contributes to the literature in two ways: One, it examines investor choice between sin and green investments during a global health emergency and views this choice against the one made during normal times. Two, instead of using the principles of modern portfolio theory (MPT) explicitly for diversification, the study uses them to identify investor preference for one over the other investment type. This has not been widely done thus far.

The study aims to identify the trends in the scholarly works on investors preference toward sustainable investments by synthesizing their knowledge structures.

A systematic search approach using PRISMA protocol on the Scopus database was used to generate a sample of 403 publications for the purpose of bibliometric analysis. The study performed a range of analyses, including three-field plot analysis, thematic mapping and cluster analysis using the VOSviewer and Biblioshiny software.

The key findings comprise the identification of four clusters within the subject, namely, corporate social responsibility and environmental, social and governance (ESG) investing, ethical investing, green finance and socially responsible investments. This study offers a clear picture of the publishing advancement and research diversification of four selected clusters' research themes, and cluster subthemes.

The research reveals the social and intellectual structure of the field, which provides the future researchers an insights into emerging themes and provides them opportunities for collaboration as well. The outcomes of the research hold significance for policymakers, governing bodies, aspiring scholars, advocates for the environment and investors. It offers an insightful framework for implementing sustainable practices, balancing profits, and environmental risks and creating value from environmentally conscious research and practice.

The future direction and extensiveness of research work have been explored using the themes generated. To the best of the authors’ knowledge, this study, which combines the VOSviewer and Biblioshiny tools, is likely the first attempt to provide a thorough bibliometric analysis in the research sphere of investors preferences toward sustainable investments.

This study aims to establish an analytical framework to help investors accommodate their environmental, social, and corporate governance (ESG) preferences. The analytical solutions were complemented by empirical analyses to shed light on their benefits and tractability.

This study proposes an expected multi-attribute utility analysis for ESG investors in which stocks can be treated as more green or less green (brown) than the market, represented by an index, all modeled in a one-factor structure. The solution is found via the Hamilton-Jacobi-Bellman (HJB) equation with proper treatment of various sources of risk. For the empirical analysis, we use the RepRisk Rating of US stocks from 2010 to 2020 to select companies that are representative of various ESG ratings.

This study finds closed-form solutions for optimal allocations, wealth and value functions. Our empirical analysis reveals drastic increases in wealth allocation toward high-rated ESG stocks for ESG-sensitive investors, even as the overall level of pecuniary satisfaction remains unchanged.

This study broadens the existing analytical framework by introducing a market portfolio along with green and brown stocks. As by-products, we first demonstrate that investors do not need to reduce their pecuniary satisfaction to increase green investment. Second, we propose a parameterization to capture investors' preferences for green assets over brown or market assets, independent of asset performance.

This paper aims to providea comprehensive review of the concepts and definitions of green finance, and the importance of “green” impact investments today. The core challenge in combating climate change is reducing and controlling greenhouse gas emissions; therefore, this study explores the solutions green finance provides emphasizing their impact on the environment and firms' financial performance. With increasing attention to the concept of green finance, multiple forms of green financial tools have come to fruition; the most prominent are green bonds.

This paper compiles a comprehensive green bond dataset, presenting a statistical study of the evolution of the green bonds market from its first appearance in 2006 until 2021.

The green bond market has seen massive growth over the years reaching $1651.92bn as of 2021. Findings show that green bonds are working towards shifting from high carbon-emitting energy to renewable energy, which is vital to economic development and growth. In congruence, green bonds are aligned with the United Nation's sustainable development goals (SDGs) amounting to $550bn for 2020, with the five most covered SDGs amounting to over 60%.

With growing worldwide concern for global warming, green finance became the fuel that pushes the world to act in combating and mitigating climate change. Coupled with adopting the Paris Agreement and the SDGs, Green finance became a vital tool in creating a pathway to sustainable development, as it connects the financial world with environmental and societal benefits.

SRI Sukuk, with its outcome-based emphasis, aims to align the Islamic finance industry with its original ideals and address criticisms related to form over substance. In Malaysia, while the pioneering Sukuk Ihsan was a “social” sukuk, recent SRI Sukuk issuances have predominantly been “green” or “sustainable” sukuk. This paper aims to evaluate the Malaysian SRI Sukuk market, identifying factors favouring “green” sukuk. It also examines whether structural issues in Sukuk Ihsan deterred subsequent issuers from “social” sukuk. The emergence of SRI Sukuk responds to sustainable development goals and the shift towards a low-carbon economy. Sukuk Ihsan, as the first Shariah-compliant pay-for-success structure, poses complexity and risk management challenges to meet performance criteria.

The study used a qualitative method in the form of a critical review of literature, interview sessions with experts and stakeholders who are familiar with SRI Sukuk and Sukuk Ihsan and a case study analysis of Sukuk Ihsan.

The popularity of “green” sukuk reflects the growing global environmental consciousness. The main factors driving the popularity of “green” sukuk are the maturity of the market and the existence of a strong supporting infrastructure for “green” issuances while the positive profiling benefits and availability of incentives for “green” issuances also contribute to a lesser extent. The recommendations include the promotion of “social” sukuk by regulators through a focus on establishing a similar supporting infrastructure for “social” sukuk as there are for SRI and standard Sukuk. In addition, issuers of “social” sukuk may want to reconsider the inclusion of key performance indicators (“KPI”) into the structure of future “social” sukuk issuances.

Although all respondents considered Sukuk Ihsan to be a success, some potential areas of improvement were also noted. These include the structuring of future “social” sukuk issuances with a bigger discount to compensate for the additional risk being assumed by the investor; the need to be more careful in the KPI selection process; and one respondent even went so far as to suggest the possibility of totally removing the step-down feature of Sukuk Ihsan.

Industry implications of Sukuk Ihsan study include findings that require balancing disclosure and economics by providing additional disclosure requirements for SRI Sukuk that may pose risks without corresponding benefits for issuers. KPI selection and investor confidence should also be properly identified, as KPIs are essential for the pay-for-success model to work successfully. For sukuk holders, findings indicate that any approval for waivers during issuance can impact investor confidence negatively. Investor literacy and impact understanding should also be improved for social Sukuk success. Investors should understand the different risk exposures and evolving impact requirements vital for sustainable growth.

The findings provide significant implications for social impact Sukuk issuance. They include providing a substantial case study for future social impact issuances, based on the pioneering impact of Sukuk Ihsan. Furthermore, Sukuk Ihsan’s unqualified success validates the feasibility of socially responsible sukuk. Despite its early introduction, both tranches being fully subscribed reflects robust investor interest. Stakeholders were also proud of their involvement in such an initiative, viewing it as a significant achievement in creating societal impact.

Although there have been several prior studies done on Sukuk Ihsan, the focus of those studies was on its structure and the novelty of its “step down” returns structure where investors would receive lower returns if certain key performance indicators (“KPIs”) are met by Yayasan AMIR in the execution of its Trust School Programme. Bearing in mind that the first Sukuk Ihsan has a June 2022 maturity date, and the results of its KPIs were announced in December 2021, to the best of the authors’ knowledge, this is the only documented case study that comprehensively reviews Sukuk Ihsan and identifies lessons learned and/or opportunities for improvement for the benefit of potential SRI Sukuk issuers in the future.