Academic Conference on Good Business

Information Transparency at Socially Responsible Mutual Funds

Socially responsible mutual funds incorporate social, environmental and governance criteria in making their investment decisions. These funds have also been lobbying their portfolio firms to improve their corporate governance structures by becoming more transparent. Do these socially responsible funds ‘walk the talk’ by being candid in their disclosures? Using a sample of 45 Canadian mutual fund managers that manage 1,650 individual funds, and a new instrument for providing a cross-sectional ranking of corporate governance disclosure levels, this study finds that disclosure transparency increases when mutual fund managers have a greater commitment to providing socially responsible mutual funds.