As our latest guest for our Research Seminar Series, we welcomed Shai Danziger from Tel Aviv University. He shared his recent work on ESG Investing and Charitable Giving Dynamics in Financial Markets.

Environmental, Social, and Governance (ESG) investments are becoming a new way of doing good, due to the possibility for investors to consider financial return alongside ethical, social, or environmental goals.

In the first part of the presentation, Shai provided evidence from a field experiment conducted on an investment app. Participants could select from various investment options and had the option to donate. The results indicate a substitution effect, whereby ESG investing can replace traditional donations, particularly among those who mentally allocate resources for donations. While this may imply a potential decline in charitable contributions due to ESG investing, the findings also reveal that ESG investments can attract individuals who do not typically donate, thereby channeling resources toward social causes through alternative mechanisms.

The second project aimed to determine whether the stock market serves as an effective context for soliciting donations and to examine the effects on both ESG and non-ESG investors. The results from two studies, which explored a priming intervention leveraging investment gains, demonstrate that financial markets can indeed be a strategic venue for charitable solicitation. Notably, this was especially true for individuals historically less inclined to donate, as they exhibited the most significant increase in giving. By contrast, investment gain priming tended to suppress donation among non-ESG investors with low prior donation behavior.

Thank you, Shai, for your visit and for sharing your work with our community!