Enhancing Shareholder Value Through Good Works

In case you missed the article in Saturday's Weekend Edition of The Wall Street Journal, Herb Greenberg did a nice story on how companies can enhance their shareholder value through good works.
link

Research on the subject is emerging yet still far from conclusive. One mutual fund company, Dover Management, studied the relationship between stock performance and philanthropy and demonstrated that companies with strong operating performance and a history of giving back, outperformed the broader S&P 500 index. PepsiCo, Johnson & Johnson and Kimberly Clark are Dover favorites.

However, solid operating performance is an essential ingredient in this mix as it provides the financial means to give back. Often, companies in trouble or unable to meet their financial targets, are the first to cut discretionary expenditures such as philanthropy.

While Dover's Responsibility Fund has delivered a healthy 22% gain since its inception in 2005, it has lagged the S&P 500 Index which is up 27%. You might want to consider giving up the extra 5 points -- a 22% gain is not too shabby -- for the peace of mind that your investment dollars are being directed to companies who share your interest in values, good works and philanthropy. To investigate setting up an account with Dover Management, go to link