Vanina Forget - Canadian Business Ethics Research Network

Vanina Forget

PhD Candidate, Department of Economics, ParisTech

vanina.forget@polytechnique.edu

Research Area:
Corporate social responsibility; econometrics; experimental economics; private equity; socially responsible investments

Vanina D. Forget is a PhD candidate at the Department of Economics of Ecole Polytechnique ParisTech (France). She holds a MS degree in business management and finance and a MS degree in environmental economics (AgroParisTech, France). Her research concentrates on sustainable finance and corporate social responsibility, with a focus on the integration of extra-financial issues in Private Equity funds. She is also an official of the French Ministry of Agriculture.

Think global, invest responsible: Why the private equity industry goes green

Abstract
The growth of socially responsible investment on public financial markets has drawn considerable academic attention over the last decade. Discarding from previous literature, this paper sets up to analyze the Private Equity channel, which is shown to have the potentiality to foster sustainable practices in unlisted companies. The fast integration of the Environmental, Social and Governance issues by mainstream Private Equity investors is unveiled and appears to have benefited from the maturation of socially responsible investment on public financial markets and the impetus of large conventional actors. Hypothesis on the characteristics and drivers of this movement are proposed and tested on a unique database covering the French Private Equity industry in 2011. Empirical findings support that Private Equity responsible investing is characterized by shareholder activism and strategically driven by a need for new value creation sources, increased risk management and differentiation. In particular, results show that independent funds, which need to attract investors, are more likely than captive funds to develop responsible practices. Evolution of the movement and future research paths are proposed.

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