Document Type

Article

Publication Date

1987

Abstract

Part I of this Article defines social investing and briefly reviews the South Africa divestment movement which has brought questions about the legality of social investing to the fore. Part II comments upon existing statutory and common law limitations on the discretion of trustee-investors to adopt policies of social investing. Part III analyzes the empirical research on the extent to which preclusion of a set of investment opportunities may impair the performance of a typical trustee-investor's portfolio, both with respect to rate of return and risk. Part IV explores the implications of the empirical evidence analyzed in Part III for the legal standards surveyed in Part II. We conclude that it is neither necessary nor appropriate to apply the legal standards limiting fiduciary discretion so as to prohibit social investing strategies no more restrictive than one requiring divestment of all stocks held in any company doing business in South Africa.

Share

COinS
 
 

To view the content in your browser, please download Adobe Reader or, alternately,
you may Download the file to your hard drive.

NOTE: The latest versions of Adobe Reader do not support viewing PDF files within Firefox on Mac OS and if you are using a modern (Intel) Mac, there is no official plugin for viewing PDF files within the browser window.