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Corporate Social Responsibility
News
11.18.2003 ET
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New Calvert Survey Shows Investors Link Corporate Responsibility with Reduced Risk, Better Returns
(CSRwire) BETHESDA, MD - Calvert, the nation’s largest family of
socially responsible mutual funds, today announced the results of a Harris
Interactive® investor survey, which dramatically highlights
investors’ growing concerns about ethical standards at corporations
and mutual fund companies. “The survey clearly shows that
investors understand that corporate responsibility matters,”
said Barbara J. Krumsiek, Calvert’s President & CEO. “It
is increasingly clear that investors believe that well-governed, socially
responsible companies are better positioned to deliver long-term,
sustainable value to their shareholders,” she added.
Conducted by Harris Interactive® for Calvert, the survey found that
investors see a definite link between good corporate governance and
shareholder value:
84% of investors are more likely to invest in a mutual fund if it
engages in ethical business practices in its operations and reporting.
71% of those surveyed said that they either strongly agreed (35%) or
somewhat agreed (36%) that companies operating with higher levels of
integrity carry lower investment risk.
68% of those surveyed said that they either strongly agreed (31%) or
somewhat agreed (37%) that companies operating with higher levels of
integrity deliver higher investment returns.
Against the backdrop of two years of corporate scandals, the Calvert
survey clearly found that investors are more interested in knowing how
the companies they invest in conduct their business. According to the
survey, compared to two years ago, investors said they now:
want their financial advisors to investigate the ethical as well as
financial performance of investments before making
recommendations—92%.
are more interested in how corporations are governed—79%
are seeking more financial and accounting information about their
investments—68%
are less confident about the trustworthiness of corporate
management—77%
are less confident about the safety of financial markets—59%
are less confident about mutual fund integrity—45%
Finally, the survey showed that investors were generally in favor of a
wide range of corporate reforms that might encourage ethical behavior.
Here are the percentages of survey respondents who felt that the following
reforms are either essential or very important:
Open and honest reporting – 90%
Having a Board of Directors that is independent from management
– 71%
Setting reasonable executive compensation – 67%
Encouraging greater shareholder voting on key issues – 61%
Diversity in the Board of Directors – 56%
“At Calvert, we have long believed that healthy corporations are
characterized by not only sound financial management but also sound
corporate governance and overall corporate social responsibility, and that
companies combining these attributes are best positioned for long-term
success,” Ms. Krumsiek added. “It is clear that more and more
investors agree, and will be seeking integrity-driven investments and
socially responsible investment strategies in order to reduce perceived
risks and improve long-term performance.”
Calvert has been a leader in promoting corporate responsibility for many
years, through its investments, social screening and shareholder advocacy
programs. Recently the firm launched a campaign called Corporate Responsibility
Matters, a five-pillar initiative designed to help contribute to
healthier companies, stronger markets and better investments. The five
pillars are as follows:
Striving for Integrity-Driven Investments
For Calvert, integrity-driven performance means seeking out companies
with sound business practices – companies that exercise strong
governance, minimize negative environmental impact, provide safe products,
engage in fair labor practices – and much more.
Encouraging Open and Honest Reporting
Through its investment selection process, shareholder advocacy, and
participation in public policy debates, the firm actively seeks to
encourage companies to report all “material”
information–not just financial information.
Building Boards That Look Like America
Calvert is launching a host of initiatives aimed at improving diversity of
corporate boardrooms. Calvert’s board diversity efforts include
filing shareholder resolutions, writing letters to over 600 companies, and
developing Model Corporate Governance and Nominating Committee Charter
Language on Board Diversity.
Championing Engaged Share-Ownership
Calvert encourages mutual fund investors to know what companies they own,
to be aware of how their proxy votes are cast, and to participate as
shareowners in the governance of the companies whose shares they own.
Promoting Sound Business Practices and Public Policies
Calvert works with civil society institutions, regulatory bodies, and
companies through partnerships, lobbying, and engagement in order to
promote strong markets, healthy companies, and better regulations.
“Calvert is committed to corporate responsibility in the way we
invest and in the way we conduct our own business,” said Ms.
Krumsiek. “At the core of this commitment is our belief that
corporations and mutual funds should be governed and managed for the
benefit of their shareholders. Our view has always been that socially
responsible investments are fundamentally integrity-driven
investments.”
The Calvert survey was based on telephone interviews with 600 respondents
with primary or shared decision making about financial investments, who
have not worked in the investment or securities industry, and who
currently own at least one mutual fund outside of their 401(k)
investments.
Calvert is the largest family of socially responsible mutual funds in the
United States with approximately $9 billion in assets under management,
offering twenty-eight funds that allow individual and institutional
investors to pursue a broad range of investment objectives within a single
fund family. Calvert created the Calvert Social IndexÔ, a benchmark for
measuring the performance of large, U.S.-based socially responsible
companies, and also offers an extensive lineup of tax-free and taxable
fixed income investments. For more information on Calvert, click on www.calvert.com.
Calvert mutual funds are underwritten and distributed by Calvert
Distributors Inc., member NASD, a subsidiary of Calvert Group, Ltd.
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