Title: Do ethical funds charge unethical fees?

Authors: Praveen K. Das; S.P. Uma Rao

Addresses: B.I. Moody III College of Business Administration, University of Louisiana at Lafayette, Lafayette, LA 70504, USA ' B.I. Moody III College of Business Administration, University of Louisiana at Lafayette, Lafayette, LA 70504, USA

Abstract: This paper examines the impact of 12b-1 fees of socially responsible mutual funds on funds' shareholders. Using a sample of 262 socially responsible funds, we find that 12b-1 fees are mainly deadweight costs and do not add any economic value to funds' shareholders. Our results suggest that fund shareholders of socially responsible funds pay the costs of 12b-1 plans but do not benefit in the form of lower operating expenses per share.

Keywords: socially responsible mutual funds; 12b-1 fees; ethical funds; ethics; shareholders; added value; social responsibility.

DOI: 10.1504/IJFSM.2016.081890

International Journal of Financial Services Management, 2016 Vol.8 No.4, pp.291 - 297

Accepted: 02 Sep 2016
Published online: 30 Jan 2017 *

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