Do Environmental Social Do Environmental Social Controls Matter to Australian Controls Matter to Australian

Capital Investment Decisions?Capital Investment Decisions?

Donald G Ross, MGSM

Dorothy Wood, ANU

Environmental Social Controls Environmental Social Controls & Capital Investment & Capital Investment

Decision-Making in AustraliaDecision-Making in Australia

Mandatory DisclosureRegulationsSubsidies Stakeholder OpinionCapital Investment Decision-Making

Research Questions & Research Questions & MethodMethod

What is the relative weight of MD, R, S, & SO in the capital investment manager’s assessments?

How important are ESCs relative to mainstream strategic and financial capital investment factors?

Does industry type moderate the influence of ESCs?

Method: survey of 1,000 Australian capital investment managers

FindingsFindings

Regulations and Stakeholder Opinion relatively important – subsidies probably not effectively used – mandatory disclosure doesn’t matter

ESCs less important than mainstream strategic and financial factors – power levels need to be reconsidered

Industry sensitivity substantially increases the influence of ESCs