In recent years, a number of groups have begun to argue that pension funds have an obligation to invest their capital in socially responsible ways. The concept of social investing of pension funds is examined with regard to legal requirements, determination of social objectives, measurement of perfornance, and financial effects. This analysis concludes that, while the problems of social investing are relatively well-defined, the benefits are nebulous. A social-oriented investment strategy should be adopted only after a careful review of all factors.
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