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RESEARCH PRODUCT

An Ethical Investments Evaluation for Portfolio Selection

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The Socially Responsible Investing (SRI) is an assets allocation, whose aim is to maximize not only the portfolio expected return but the benefits for a consumer who as a whole operates according to the ethical principles. The wealth of a market economy is to cross the different ethical identities of families, of enterprises, of banks, in order to improve the allocation of the resources for a sustainable development. In this paper, we aim at describing the portfolio selection realized on the basis of the ethical principles - positive /negative, inclusionary/exclusionary - of an investor. The first part of this paper describes Socially Responsible Investing (SRI) and ethical funds market in the world; the second part builds an ethical index as evaluation of the coherence of the ethical principles of the investor in comparison with the ethical principles respected in the investment. The paper also illustrates the set of admissible portfolios for an ethical investor, obtained on the basis of the following indexes - of risk, of expected return and of ethicality.