An Initial Study of Disclosures Related to Responsible Investing Implementation: A South African Perspective

Abstract

Purpose: Financial institutions (FIs) such as banks, insurance companies and pension funds have a significant impact on the environment through the financing they provide. Mining and oil and gas companies receive funding and use this for different projects which may have environmental consequences. This study examines the extent to which both the grantor and the receiver of finance identify and apply responsible investment (RI) practices when making investment decisions Design/methodology/approach: A detailed literature review was used to construct a disclosure checklist to assess the implementation of RI principles. The population is all companies listed in the financial services, banks, mining and oil and gas sectors of the Johannesburg Stock Exchange (JSE), who had published integrated reports. Findings: The results of this research indicate that the extent of RI disclosure in FIs in South Africa is limited. The extent of RI disclosure for the mining and oil and gas companies is stronger than for FI’s. Originality/value: At present, there are no studies which have investigated the disclosure of RI principles applied in South Africa. This study constructed a RI disclosure checklist, drawing on the principles of RI to understand the implementation of RI in South Africa.

Keywords

• Financial institutions
• Responsible Investment
• Integrated report
• ESG
• Mining companies and Oil companies