Investing in socially responsible mutual funds: Proposal of non-financial ranking in Italian market

• This paper examines the investing in socially responsible mutual funds in Italian market.
• A methodology useful to define the attractiveness of socially responsible investments is presented.
• The methodology is based on multi criteria method, the AHP.
• The model is feasible and gives useful results for investors demanding social responsibility.
• The result is the definition of a non-financial ranking.

Currently, one of the main instruments of Socially Responsible Investment is mutual funds. Their growth in the financial market has been remarkable over the past few years, which has also paralleled the growth in the business ethics literature.The aim of the present work is to present a methodology useful to define a portfolio selection model for measuring the attractiveness of socially responsible asset investments. The result is the definition of a non-financial ranking to complete financial information about mutual funds for investors demanding Corporate Social Responsibility. The methodology focuses on social responsibility decision-making criteria and their weights agreed by the main stakeholders. The research, based on a well-known multi-criteria method, the Analytic Hierarchy Process (AHP), proves that the methodology is feasible and gives useful results for investors demanding social responsibility.

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