ABSTRACT
The notion that environmental performance is an important component of competitive advantage is becoming more and more acceptable to corporate leaders and financial institutions. The relationship between environmental performance and financial performance is a key concern for the financial sector. Little academic research has been carried out on the link between environmental and financial performance, and results indicate an ambiguous relationship. A study was carried out in 1998 on the relationship between corporate environmental performance and financial performance in Europe. The financial parameters chosen are the most important ratios for evaluating a firm's profitability, management performance and future prospects. Because of the way the fund management system is structured, financial and social/environmental matters are processed independently. All companies that might be eligible for inclusion the Added Value Investment Fund portfolio are investigated to determine whether they fulfil the exclusionary criteria related to social and environmental aspects.
