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Are investors willing to sacrifice cash for morality?

Berry, R. H.; Yeung, F.


R. H. Berry

F. Yeung


The paper uses questionnaire responses provided by a sample of ethical investors to investigate willingness to sacrifice ethical considerations for financial reward. The paper examines the amount of financial reward necessary to cause an ethical investor to accept a switch from good ethical performance to poor ethical performance. Conjoint analysis is used to allow quantification of the utilities derived from different combinations of ethical and financial performance. Ethical investors are shown to vary in their willingness to sacrifice ethical for financial performance, and hence to display more heterogeneity than the all-encompassing ‘ethical’ label implies. Because of the existence of sub-groups of ethical investors with different attitudes towards financial reward, an attempt has been made to associate observable investors’ characteristics with their level of willingness to trade-off morality for cash. One sub-group of investors in particular appears highly resistant to the idea of accepting higher financial return as compensation for poor ethical performance. This unwillingness casts doubt on Jensen and Meckling’s widely reported claim that trade-off behaviour is ubiquitous in all areas of life.


Berry, R. H., & Yeung, F. (2013). Are investors willing to sacrifice cash for morality?. Journal of Business Ethics, 117(3), 477-492.

Journal Article Type Article
Acceptance Date Dec 31, 2012
Online Publication Date Nov 3, 2012
Publication Date 2013-10
Journal Journal of Business Ethics
Print ISSN 0167-4544
Electronic ISSN 1573-0697
Publisher Springer Publishing Company
Peer Reviewed Peer Reviewed
Volume 117
Issue 3
Pages 477-492
Keywords Economics and Econometrics; General Business, Management and Accounting; Business and International Management; Arts and Humanities (miscellaneous); Law
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