Applying Ethics in Investments Essay Example | Topics and Well Written Essays - 5750 words

Applying Ethics in Investments - Essay Example mmendation 26 4.1 Conclusion 26 4.1 Recommendation 27 Reference 28 Appendix 1 31 Wright Quality Ratings 31 Appendix B: Company Operations Information 32 Mayne Pharma Group Limited 32 Singapore Telecommunications (SGT) 32 Renaissance Uranium (RNU) 33 List of Tables Table 1: Environmental qualification criteria employed for screening of companies for investment 17 Table 2: Evaluation of environmental credentials 19 Table 3: Evaluation of Corporate Governance Credentials 21 Table 4: Evaluation on the basis of contextual factors 22 Table 5: Evaluation on the basis of financial performance and prospects 25 Tables of Figures Figure 1: Adapted form source: Morningstar, 2011. Equity Research Methodology. [Online] Morningstar (January 27, 2011) Available at: http://news.morningstar.com/pdfs/Equity_Research_Methodology_102308.pdf [Accessed 14 September 2011]. 12 Figure 2: Research process adopted for the study 14 Figure 3: Sub-factors considered under factor financial performance and prospects 27 Section 1: Executive Summary This study was undertaken to choose the most worthy company among three companies namely, Mayne Pharma Limited, Singapore Telecommunications, Renaissance Uranium, with the aim to invest $500,000 on a long-term basis. Four main criteria were considered to evaluate the companies’ performance. These were (1) financial performance and prospects, (2) corporate governance performance, (3) environmental protection credentials, (4) Contextual factors (e.g. legal/political issues, global or regional economic pressures, etc.). An extensive review of existing literatures on the subject was undertaken to identify suitable comparison variables on the basis of which the companies were to be evaluated. A total of 24 sub-criteria criteria were listed under the financial... Four main criteria were considered to evaluate the companies’ performance. These were (1) financial performance and prospects, (2) corporate governance performance, (3) environmental protection credentials, (4) Contextual factors (e.g. legal/political issues, global or regional economic pressures, etc.). An extensive review of existing literatures on the subject was undertaken to identify suitable comparison variables on the basis of which the companies were to be evaluated. A total of 24 sub-criteria criteria were listed under the financial performance and prospects; twelve sub-criteria were identified under corporate governance; seven sub-criteria under environmental protection; while the contextual factors consisted four sub-criteria. On the basis of the four criteria and the variables contained in the sub-criteria, a scoring method was developed and the companies’ performance was compared. The findings revealed that Singapore Telecommunications is most worthy compan y. Accordingly, the company was recommended for long-term investment. As Beal et al (2005) brought out in their paper Why do we invest ethically? Over the last two decades, one particular type of behaviour is the desire to invest ethically† (Beal et al., 2005). The authors add that â€Å"based on traditional finance theory and the ethical investment literature, there are three potential reasons why people may invest some or all of their funds ethically: (1) for superior financial returns; (2) for non-wealth returns; and (3) to contribute to social change (Beal et al., 2005). These motivations also inspired this report and prompted that investing should not only be made for shareholders’ wealth maximisation but also for sustainable development.

Oil Prices Essay Example | Topics and Well Written Essays - 2000 words

Oil Prices - Essay Example A customary perception based on what happened in the 1970s is that oil price shocks trigger recessions. However, the recent past does not fit this view-oil prices are about 2 1/2 times their 2002 levels-but this increase has seemingly not had much impact on the global economy. This seeming puzzle has brought attention to the need to identify the sources of the oil price increase, in particular, to distinguish the role of supply and demand reasons. [1] This box examines these issues using an extended version of the Global Economy Model (GEM) to analyze the causes and outcomes of changes in oil prices. It also looks at the global macro-economic impact of higher taxes on petroleum products. It is important to this clear this from the beginning the analysis does not take on to assess the relative importance of demand and supply causes in the recent run-up in oil prices. In contrast, the main focus is on patterning the channels through which oil prices and growth interact. Global Macro-economic Implications of a Supply Impelled Oil Price Hike First: take the case where oil-exporting economies restrict the supply of oil (as in the 1970s). Oil prices rise sharply (100 per cent at the peak of the simulation) and this results in a global slowdown as redistribution of income to the oil-exporting economies, which have a lower inclination to spend than the oil-importing economies. In addition, higher oil prices raise the cost of production a nd put upward pressure on the collect price level leading to an increase in interest rates, which- in sync with the direct influence on manufacturing outlays-would further decrease in the short run. As a result, world GDP falls 1.4 per cent below the baseline at the trough and global inflation rises about 1.5 percentage points (first figure). The regional macro-economic outcomes of higher oil prices depend on whether a country is a net oil exporter or importer, and on its oil intensity. Oil exporters run a large trade surplus, peaking around 6 per cent of GDP above the baseline, and enjoy a vigorous expansion. In contrast, the oil-importing economies suffer weakening in their external balances and a slowdown in. The impact is more significant in immerging Asian economies chiefly because of their higher oil intensities about advanced economies. On balance, the effects on inflation and GDP in this scenario are significantly smaller than viewed in many industrial countries in the 1970s . [1] First, this partially reflects the lower oil intensities of consumption and production, which lessen both the direct affects on inflation and the medium- and long-term affects on GDP. Second, these simulations assume that forward-looking inflation targeting central banks raise interest rates at once to prevent a ratcheting up of inflation expectations and a spillover into wages and other prices, unlike what happened in the 1970s. Third, many countries have fulfilled reforms that have increased flexibility in both labor and product markets, simplifying more rapid adjustment in relative prices in response to oil price shocks. Combined with creditable monetary policies that have anchored longer-term inflation expectations, these improvements have allowed containing inflationary pressures caused by the higher oil prices without excessively dampening. However, the simulations do not account for possible business and consumer confidence affects or capital market