Responsible Investing and Stock Allocation
28 Pages Posted: 26 May 2021
Date Written: May 25, 2021
Abstract
We analyze the portfolio choices of approximately 913,000 active participants in
employee saving plans in France. Looking at the cross-section of equity exposure, we
find that the inclusion of responsible equity options in the menu of available funds
is associated with a 2.1% higher equity allocation by plan participants. Compared
to an average equity asset allocation of 12.1%, it represents a material increase (17%
in relative terms). Difference-in-differences analyses confirm that the introduction
of a responsible equity option to a saving plan is followed by an increase of 7.2% in
participants' appetite for stocks, contrary to what happens with conventional equity
funds.
Keywords: Behavioral finance, household finance, investor preferences, socially responsible investments, sustainable finance
JEL Classification: A13, D14, G11, G41, G50
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