Business and Society

SRI in the field: savvy investors find finance more convincing than ‘feelgood’ factor

December 10, 2012 | 2 min read

The authors had the unique opportunity of being allowed to ‘take over’ the Skandiabanken as the bank’s management was preparing to implement a responsibility classification system for investments.“The practical concerns of a Norwegian bank manager were in fact the starting point for the present study,” say Assistant Professors Døskeland and Pedersen. “The manager realized that while its customers expressed interest in SRI, the bank did not properly understand the customers’ motivations, which made it difficult for them to design and distribute the investment product.” The question was, in other words, what do investors really want (see also research by Meir Statman[1])?

Financial vs. non-financial information

Thus the researchers were able to investigate investor behavior during their first introduction to the concept of SRI in the bank’s investment setting. Investors typically use two types of information in order to make individual investment decisions: financial information and non-financial information. The authors offer an SRI-friendly example of the use of these types of information: the decision to buy an environmentally-friendly hybrid car.The fuel economy, tax benefits, and other financial benefits to such an ‘investment’ constitute the financial information around this choice. Non-financial information includes the social and ecological ramifications of the car – that such cars contribute less to global warming, use renewable materials and energy, etc.Both types of information are important; which, however, is most convincing to the consumer in the relatively new field of SRI?

The playing field

To determine which type of information would be more likely to influence Skandiabanken’s customers towards SRI investment choices, the research team took part in a communication the bank sent out introducing its new classification system for mutual funds. This provided a relatively ‘clean’ playing field, as Skandiabanken had not previously focused on SRI. The communication medium was an online newsletter sent out to 140,000 of the bank’s customers.

“We were allowed to manipulate the information in the newsletters, and we designed two versions…in order to create two experimental groups. The variable that was manipulated was the information provided…which was tailored to frame the decision financially and non-financially, respectively.” Both versions of the newsletter, which was sent to two randomized groups of 70,000 customers, included a link to websites with deeper information about SRI. Each of the websites was also ‘manipulated’ to coordinate with the two versions of the newsletter, to frame the information on SRI in either a financial or non-financial manner.

Measuring clicks and behavior

By measuring the clicks from the newsletter to the informational website, and then further looking to actual investments made, the researchers discovered that financial information was more effective in triggering SRI investment choices in the customer groups who were part of the field experiment. “Our findings show that investors who received financially framed information are more likely to (1) search for further information and (2) invest responsibly than investors with a non-financial decision frame.” While this runs counter to earlier (laboratory) research into SRI[2], the NHH researchers say that results of lab research is inherently different — and likely less accurate — than that from their field experiment. “Our findings indicate that there is a difference between what investors say they want and what they actually do with their savings,” they conclude.

They proposethat other factors may also help explain the deeper interest and greater potential for SRI investment in those who have received financial rather than non-financial information. “We suggest a behavioral solution that emphasizes the investor’s need for uncertainty reduction by means of ‘financial proof’.Moreover, we find that the effectiveness of financial information increases with the financial sophistication of the investor.”


  1. Statman, Meir. “Socially responsible investments and investors.”, September 9, 2011.
  2. Barreda-Tarrazona, Iván, Juan Carlos Matallín-Sáez, and Ma Rosario Balaguer-Franch. “Measuring Investors’ Socially Responsible Preferences in Mutual Funds.” Journal of Business Ethics 103, no. 2 (October 1, 2011): 305–330.


This article may be reproduced according to our terms of use with attribution (and link, if online) to To be cited as: “SRI in the field: savvy investors find finance more convincing than ‘feelgood’ factor”, Døskeland, Trond and Lars Pedersen,, December 10, 2012.

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Research paper Døskeland and Pedersen

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