This paper presents an updated analysis of the sustainable and responsible investment (SRI) value network. SRI could be defined as the type of investment which aims to achieve financial returns while performing in terms of extra-financial aspects, such as social, environmental, governance, and ethical objectives. In recent years, the interest in SRI has been growing and new SRI-specific actors and roles have emerged. This paper aims to contribute to achieving better understanding of the specificity of SRI fund industry and involved stakeholders. It contributes to the formalization of the roles within the SRI- specific value chain with goal and value modeling languages. Authors: Slim Turki, slim.turki@tudor.lu Marija Bjeković-Obradović, Corentin Vermeulen Public Research Centre Henri Tudor, 29, Av. John F. Kennedy, L-1855 Luxembourg-Kirchberg, Luxembourg 17th IBIMA Conference Milan, Italy, 14-15 November 2011 http://www.ibima.org/italy2011/index.html An extended version of this study is available here: http://www.ibimapublishing.com/journals/JFSR/2012/868722/a868722.html

1. Exploring Sustainable and Responsible
Investment:
Stakeholders’ value exchange
Slim Turki, Marija Bjeković-Obradović, Corentin Vermeulen
17th IBIMA Conference
Milan, Italy 14-15 November 2011

2. Sustainable and Responsible Investment
(SRI)
“Type of investment which aims to achieve financial
returns while performing in terms of extra-financial
aspects, such as social, environmental, governance,
and ethical objectives”
(Vermeulen & Mention, 2011)

3. Context
Growing market for SRI funds
• Global SRI market has grown by more than 200% between 2006 and 2010
to reach $11 trillion (EUROSIF)
• European SRI market share (AuM) has grown by more than 500%
between 2006 and 2010 to reach € 5 trillion (EUROSIF)
• SRI market is still expected to grow in the coming years
New SRI-specific actors and roles have emerged
• new activities remain unregulated
• profusion of labels and funds claiming to be responsible and sustainable
0
1000
2000
3000
4000
5000
6000
2002 (EU-8) 2005 (EU-9) 2007 (EU-13)2009 (EU-14)
Billion€
Size of the European SRI market (AuM)
Core SRI Broad SRI

4. Objectives
Contribute to achieving better understanding of the specificity of
SRI industry and involved stakeholders
Formalize and enable clear distinction of roles and responsibilities
of different stakeholders within the SRI- specific value chain
Contribute to establishing regulative framework enabling better
control of SRI-related activities

5. Methodology
1- Analysis & Modelling
• identify and structure stakeholders
• analyse dependencies and existing/possible value exchanges between
actors, to develop models, combining goal and value models
• relying on the academic and professional literature
2- Validation / update
• to be executed
• will comprise validation of models through interviews with a representative
sample of stakeholders identified at European level

6. Goal Modelling with i*
Philosophy
• Actors don’t merely interact with each other through actions or
information flows but relate to each other at an intentional level
• Strategic actors: depend on each other for goals to be achieved, tasks to
be performed, resources to be provided
• Strategic goals are achieved through a network of intentional
dependencies.
• Strategic Rationale (SR) model

7. i* - main concepts
Goal Condition or state of affairs to be achieved
Soft goal Goal without a clear-cut criterion for achievement
Task Way of contributing to the accomplishment of a goal
Resource Physical or informational entity needed to achieve goal or to perform task
Means-ends particular way to achieve a goal
Decomposition how an intentional element is decomposed into sub-elements
Contribution how the achievement or fulfillment of one goal or task contributes positively or
negatively to the achievement of another task or goal
Actor Active entity that carries out actions to achieve goals.
Role Abstract characterization of the behavior of a social actor within some specialized context

8. Classical investment chain – actors’
rationale
+ Promoter
+ Asset manager
+ Distributor

9. SRI chain – actors’ rationale
Version 1.0

10. Value modelling
• intended to model network of enterprises creating, distributing, and
consuming things of economic value
• explore innovative e-business idea
Main Concepts
• Actor: Independent economic entity. Makes profit or increases its utility.
• Value object: service, good, money, or experience, which is of economic value
to at least one actor. Actors exchange value objects.
• Value exchange: one or more potential trades of value objects.
Business model drawing tool
boardofinnovation.com

11. SRI value network proposition

12. Conclusion & Perspectives
Identify stakeholders participating to the SRI-specific value
network & analyse their mutual exchanges
Models as formalized tools to:
• identify stakeholders participating to the SRI-specific value network
• analyse their (potential) mutual exchanges
• identify the risks of SRI deviations that may occur
• detect possible conflicts of interest
• discuss and structure the critics of SRI
• explore the ways in which better social impact of SRI can be guaranteed
• i.e. establishing alternative value networks
Intended cycle of validation through interviews
• clear definition of responsibilities among value network
• contribution to clarify the SRI offer

13. Exploring Sustainable and Responsible
Investment:Stakeholders’ value exchange
Slim Turki, Marija Bjeković-Obradović, Corentin Vermeulen
17th IBIMA Conference
Milan, Italy 14-15 November 2011
slim.turki@tudor.lu
@sl_tu

14. Models and Hypotheses to be completed
/ validated
Possible conflicts of interest and deviations
• SR Investment vehicle are subject to “administrative” fees for obtaining the
SRI labels > independency of the labelling agencies.
• Rating agencies not directly financed by investee, but have the great
impact on the investee’s attractivity > investee may be lead to influence in
one or the other way the rating evaluation process.
• Investor has no other options than to trust the claims on SRI character of
the assets held by SR investment vehicle, since the rules are not clearly
established
Hypotheses resulting from the analysis to be validated
validation of the models will serve us to propose a clear definition
of the responsibilities among the value network and a
contribution to the clarification of the SRI offer.