SELECTION OF SOCIALLY RESPONSIBLE INVESTMENT PORTFOLIOS USING THE RESTRICTIONS METHOD AND A MULTIPLE CRITERIA ANALYTIC HIERARCHY PROCESS TECHNIQUE

SELECTION OF SOCIALLY RESPONSIBLE INVESTMENT PORTFOLIOS USING THE RESTRICTIONS METHOD AND A MULTIPLE CRITERIA ANALYTIC HIERARCHY PROCESS TECHNIQUE

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Lady Mayerly Bernard Suárez
Néstor Raúl Ortiz Pimiento
Juan Benjamín Duarte Duarte

Abstract

This paper presents a procedure to support investors’ decision-making process to select a portfolio that meets their economic and corporate social responsibility (CSR) expectations. Profitability and risk criteria were considered as economic measures, which, when addressed using the restrictions method, provide a series of efficient portfolios that were used as alternatives to apply the multiple criteria analytical hierarchy process (AHP) technique. This technique makes it possible to select the portfolio that meets criteria related to corporate governance, employee relations, the environment, and community relations as CSR measures.
The procedure was applied to select investment portfolios from the Colombian stock market. The study found that the portfolio that best met the CSR criteria proposed in this paper was also the one with minimum risk.

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Author Biographies ##ver##

Lady Mayerly Bernard Suárez

Industrial engineer. Universidad Industrial de Santander. Bucaramanga, Colombia

Néstor Raúl Ortiz Pimiento

Magister in Systems Engineering, Universidad Industrial de Santander. Bucaramanga, Colombia.

Juan Benjamín Duarte Duarte

Doctor in company finances. Universidad Industrial de Santander. Bucaramanga, Colombia.