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Many ‘impact investors’ aren’t fully tracking whether their investments are good for society or the environment − new research

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theconversation.com – Lauren Kaufmann, Assistant Professor of Business Administration, University of Virginia – 2025-01-10 07:25:00

Establishing a lofty goal doesn’t guarantee its accomplishment.

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Lauren Kaufmann, University of Virginia and Helet Botha, University of Michigan-Dearborn

Investors can aim not only to make money but to benefit society while doing so. But few of those impact investors follow up on whether their strategy is having a positive impact, we found in a study published in the Journal of Business Ethics.

Impact investing aims to generate financial returns while also creating positive social or environmental outcomes. But having the intention of doing good by selecting the right assets doesn’t guarantee that you will. We call this uncertainty “impact risk.”

After conducting 124 interviews with impact investors and an experiment with 435 participants, we found that, rather than evaluate impact risk directly, many impact investors presume that they will succeed at having a positive effect on the world when they assess their investment options.

In other words, they assume that certain businesses, such as solar energy companies or microfinance initiatives, are inherently good for society. This “win-win” mindset leads investors to focus primarily on financial performance rather than on evaluating whether their investments are achieving social or environmental impacts. Often, this means that investors can’t determine whether specific investments perform better than others on social metrics.

We found that this mindset discourages investors from seeking information that might point to shortcomings in an investment’s social performance.

Why it matters

Impact investment, a rapidly growing area of finance, surpassed US$1.5 trillion globally by the end of 2024, according to the Global Impact Investing Network. The industry has attracted a range of investors, including wealthy individuals, banks, development finance institutions, corporations, foundations, pension funds and religious institutions.

Nearly 75% of younger individual investors, including millennials and Gen Z, prioritize aligning investments with their social values.

With much of the projected $84 trillion in wealth expected to be inherited from older people by 2045 flowing to millennials and other younger Americans, in what has been called the “great wealth transfer,” financial institutions such as Goldman Sachs, Morgan Stanley and Vanguard are trying harder to appeal to impact investors. They now offer a range of investment options promising both social impact and financial performance.

We found, however, that good intentions alone may not deliver consistent social impact. Without robust risk assessments and ongoing evaluations of whether investments have the intended outcomes, impact investments may fall short of their goals.

What still isn’t known

Many questions remain about how investors can effectively assess impact risks without creating potentially onerous reporting requirements – for themselves or their clients. Some of our related research has determined that financial managers are concerned about this potential burden.

But new regulations are likely anyway. For instance, a proposed Securities and Exchange Commission rule would require public corporations in the U.S. to disclose risks associated with climate change. Yet, due to pending litigation, the rule’s implementation has been delayed – perhaps indefinitely.

What’s next

Our next phase of research is building on these findings by examining how impact investors seek out and respond to evidence of underperformance. With additional colleagues at the University of Virginia, we are currently investigating whether moral clarity – the extent to which people feel confident in their ethical decision-making – influences investors’ behavior.

By continuing to research connections between impact and financial performance, we aim to contribute to a broader conversation, both in academia and in practice, about how to ensure investments truly benefit people and the planet.

The Research Brief is a short take about interesting academic work.The Conversation

Lauren Kaufmann, Assistant Professor of Business Administration, University of Virginia and Helet Botha, Assistant Professor of Business Policy and Strategy, University of Michigan-Dearborn

This article is republished from The Conversation under a Creative Commons license. Read the original article.

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Trump gets an ‘unconditional discharge’ in hush money conviction − a constitutional law expert explains what that means

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theconversation.com – Wayne Unger, Assistant Professor of Law, Quinnipiac University – 2025-01-09 13:36:00

A judge imposed an unusual sentence on President-elect Donald Trump in his criminal hush money case.

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Wayne Unger, Quinnipiac University

Donald Trump is now a convicted felon, and will be the first president of the United States with a felony conviction.

On Jan. 10, 2025, Justice Juan Merchan, who presided over the trial in a New York state court, sentenced Trump to an unconditional discharge for all 34 felony counts of falsifying business records in the first degree. In his statement to the court, Trump maintained the point he had made throughout the prosecution, that the whole case was a political witch hunt.

“The fact is, I’m totally innocent,” said Trump via a video appearance in the court.

During the sentencing, Merchan said he was keenly aware of the unique set of circumstances before him and the country. He characterized the trial as ordinary while acknowledging the context of the case was extraordinary.

“Never before has this court been presented with such a unique and remarkable set of circumstances,” said Merchan.

The sentencing brings this phase of the case to an end. Once the sentence is officially entered in a final judgment, Trump can appeal the case, as he has a legal right to do so. Trump’s attorney, Todd Blanche, made clear during the sentencing that Trump intends to appeal.

Trump ultimately failed to block sentencing

On May 30, 2024, a New York County jury found Trump guilty on 34 counts of falsifying business records in the first degree. That constituted a Class E felony in the state of New York, when the falsification is committed with an intent to defraud, commit another crime, or to aid or conceal the commission of another crime.

Class E felonies carry a potential penalty of up to four years in prison and a fine up to $5,000 for each count. Trial courts reserve discretion, however, to impose a sentence that accounts for other factors, such as the defendant’s criminal history.

In recent court filings, Trump sought to get his guilty verdict thrown out, arguing that the U.S. Supreme Court’s recent decision on presidential immunity in criminal prosecutions meant he can’t be found guilty.

On July 1, 2024, the U.S. Supreme Court had concluded that the Constitution provides “absolute immunity from criminal prosecutions for actions within his … constitutional authority.” The court had also concluded that presidents hold “at least presumptive immunity from prosecution for all his official acts” and “no immunity for unofficial acts.”

To be clear, Trump was convicted of unlawful conduct that occurred before his first term as president. And while it appears that the Supreme Court’s July 1 ruling applies to both state and federal criminal prosecution, the court held there is no immunity for unofficial acts, which the falsification of business records undoubtedly is.

A serious-looking man in a suit and tie sitting at a table next to another man.

Donald Trump at a pretrial hearing in his hush money case at Manhattan Criminal Court on Feb. 15, 2024.

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On Jan. 3, 2025, Justice Merchan rejected Trump’s argument regarding presidential immunity because the Supreme Court’s immunity decision is not applicable in Trump’s New York case.

On Jan. 9, 2025, New York’s highest court declined to block Trump’s sentencing. The U.S. Supreme Court late in the same day denied Trump’s emergency bid to halt the sentencing, saying in its order that “the burden that sentencing

will impose on the President-Elect’s responsibilities is relatively insubstantial in light of the trial court’s stated intent to impose a sentence of ‘unconditional discharge’ after a brief virtual hearing.”

Indeed, Merchan had expressed little willingness to impose prison time for the president-elect. In the order rejecting Trump’s presidential immunity argument, Merchan said, “It seems proper at this juncture to make known the Court’s inclination to not impose any sentence of incarceration.”

Even if Merchan imposed prison time, many constitutional law scholars, including myself, argue that Trump’s sentence would, at minimum, be deferred until after his next term in the Oval Office.

Rather, Merchan imposed “unconditional discharge” as a sentence. That means there are no penalties or conditions imposed on Trump, such as prison time or parole.

Serving the public interest, not time

According to New York law, a court “may impose a sentence of unconditional discharge … if the court, having regard to the nature and circumstances of the offense and to the history, character and condition of the defendant, is of the opinion that neither the public interest nor the ends of justice would be served by a sentence of imprisonment and that probation supervision is not appropriate.”

Regarding Trump’s case specifically, Merchan wrote, “A sentence of an unconditional discharge appears to be the most viable solution to ensure finality and allow (Trump) to pursue his appellate options.”

Put simply, it appears Merchan, having considered the totality of the circumstances, including Trump’s election to a second term as president, concluded, as is his right as a judge, that it is in the best interest of the public not to imprison Trump.

Generally, trial courts reserve a tremendous amount of discretion when it comes to imposing sentences. Legislatures can, and often do, set sentencing guidelines, prescribing what penalties trial judges can impose. It is clear in this case that the New York State Legislature allows trial judges to, at their discretion, deliver “unconditional discharge” as a sentence.

Uniquely, Trump had sought dismissal of his guilty verdict before his sentencing. Normally, criminal defendants do not have a legal right to appeal their verdicts until a final judgment is entered against them. In criminal law, a final judgment must include the defendant’s sentence.

But, of course, this is not your ordinary criminal case. As Merchan hinted, moving forward with the sentencing favored Trump because it would result in a final judgment being entered against him, thus enabling him to properly appeal his conviction.

This story has been updated to reflect the U.S. Supreme Court’s order denying Donald Trump’s bid to delay his Jan. 10 sentencing and to include the actual sentence entered against Trump.The Conversation

Wayne Unger, Assistant Professor of Law, Quinnipiac University

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Even 1 drink a day elevates your cancer risk – an expert on how alcohol affects the body breaks down a new government report

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theconversation.com – Nikki Crowley, Assistant Professor of Biology, Biomedical Engineering and Pharmacology, Penn State – 2025-01-10 07:26:00

The Surgeon General’s report links alcohol to 100,000 cancer cases every year.

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Nikki Crowley, Penn State

Many people use the new year to reflect on their relationship with alcohol. Just-released government guidelines are giving Americans another reason to consider a “dry January.”

Over the past few decades, mounting scientific evidence has shown that as little as 1-2 alcoholic drinks per day can lead to increases in the likelihood of several cancers. This prompted the U.S. surgeon general, Dr. Vivek Murthy, to release a new Surgeon General Advisory on Jan. 3, 2025, warning about the link between alcohol and cancer. This report highlighted the evidence and included a call for new cancer warning labels on alcoholic beverages.

The association between alcohol and cancer isn’t new news – scientists have been trying to determine the link for decades – yet most people aren’t aware of the risks and may only associate drinking with liver disease like cirrhosis. In a 2019 survey from the American Institute for Cancer Research, less than half of Americans identified alcohol as a risk factor for cancer.

Alcohol is the third-most preventable cause of cancer in the U.S, putting it just behind tobacco and obesity. As the surgeon general’s report highlights, alcohol is associated with approximately 100,000 cancer cases and 20,000 cancer deaths every year, playing a role in breast, liver, colorectal, mouth, throat, esophagus and voice box cancer cases. Alcohol-induced cancer deaths outnumber alcohol-associated traffic crash fatalities every year.

A diagram of the human body showing the seven types of cancer caused by drinking.

The increase in alcohol-induced breast cancer is a particular worry.

Office of the U.S. Surgeon General

The report included the suggestion to add warning labels to alcohol similar to what is already required for tobacco products – another substance of abuse known to cause cancer.

As a neuroscientist specializing in the neurobiological effects of alcohol use and binge drinking, I am glad to see the call to action for reducing alcohol consumption in the United States.

Key takeaways of the report

With so few people aware of the links between alcohol consumption and various cancers – and the fact that the vast majority of people consume some alcohol every week – it’s easy to see why the surgeon general is calling for greater awareness. The 22-page report highlights what scientists know about the relationship between alcohol and cancer, and suggests actions for moving forward. Those include label changes on alcohol, which have not been updated since they were created in 1988.

Somewhat strikingly, breast cancer carries a large portion of this risk – making it particularly worrisome in the face of increased alcohol use among women.

These numbers don’t only apply to heavy alcohol drinkers. While less alcohol is better, 25% of these cancer cases were in people classified as moderate drinkers – consuming, on average, fewer than two drinks per day. This means that anyone regularly drinking alcohol, even small amounts, should know about and understand the risks.

Surgeon general’s advisories are the primary way that the Department of Health and Human Services, where the Office of the Surgeon General resides, communicate health issues of great importance to the public. Surgeon general’s advisories are not necessarily breaking news, but they take the opportunity to bring public awareness to science surrounding big public health issues.

A diagram showing that the majority of Americans don't know that alcohol increases cancer risk.

Many Americans will be surprised by the conclusions of the surgeon general’s report.

Office of the U.S. Surgeon General

The science behind the link between alcohol and cancer

The relationship between alcohol and cancer has been clear to scientists for decades. In fact, it was highlighted in a 2016 surgeon general’s report as well, which focused on addiction more broadly.

The new report outlines the different types of evidence supporting this link. One way is through epidemiological science, which tries to understand patterns and relationships between the rates of cancer and how much alcohol people consumed. Another is through experimental animal studies, which allow scientists to understand the mechanism and causality of these connections as they apply to specific cancers. Together, studies conclusively show a link and pathway between alcohol consumption and cancer.

The surgeon general’s report highlights four key pathways through which alcohol can cause cancer. These largely focus on the ways alcohol can negatively affect your DNA, the building blocks of cells. While the healthy cells in your body divide all the time, their abnormal growth can be driven by aberrant factors like alcohol-induced DNA damage.

This DNA damage leads to uncontrollable growth of tissue instead of healthy, normal tissue growth. This abnormal tissue growth is cancer. The four pathways through which alcohol can lead to cancer highlighted in the report are:

  1. The body naturally breaks alcohol down into acetaldehyde. Acetaldehyde can damage and break DNA, leading to chromosomal rearrangements and tumors. This link is so strong that acetaldehyde has been classified as a carcinogen since 1999.

  2. Alcohol creates reactive oxygen species. Reactive oxygen species, sometimes called “free radicals,” are unstable molecules that contain oxygen and can further damage DNA, proteins and fats.

  3. Alcohol can influence hormones, like estrogen. Alcohol can raise the amount of estrogen in the body, which may explain its link to breast cancer. This increased estrogen can influence breast tissue by causing – you guessed it – DNA damage.

  4. Alcohol is a solvent, which means other things can dissolve in it. This makes it easier for carcinogens from other sources – like cigarettes and e-vapes – to be absorbed by the body when the two are consumed together.

A diagram that shows how higher alcohol consumption increases cancer risk.

The more you drink alcohol, the more you are at risk.

Office of the U.S. Surgeon General

Is any amount of alcohol safe?

The biggest question on people’s minds right now is likely “how much alcohol can I safely drink?” and the answer to that might disappoint you – probably none.

Alcohol use remains one of the most preventable risk factors for cancer. And even moderate alcohol consumption – one or fewer drinks per day – may elevate cancer risk for some types, such as breast, throat and mouth cancers.

But none of these studies can tell you what your individual risk for cancer is. The relationship between alcohol and cancer can be influenced by your genes, such as those that control the enzymes that metabolize alcohol, and other lifestyle factors that influence the rates of cancer broadly, like diet and inflammation. All of these lifestyle and personal health factors can influence how risky alcohol consumption is for you.

The Centers for Disease Control and Prevention notes that if you choose to drink, consider sticking to less than one, for women, or two, for men, standard servings of alcohol per daywhich might be smaller than you think, and don’t binge drink alcohol at all. The surgeon general is also suggesting a rethinking of these guidelines to include updated limits on daily alcohol consumption and greater educational efforts around the link between alcohol and cancer.

The National Institute on Alcohol Abuse and Alcoholism has similar recommendations around limiting alcohol consumption and advises that for people who choose to drink alcohol, “the less, the better.”

The institute offers tips on its website for managing your alcohol consumption or abstaining from alcohol consumption altogether, including finding alternative hobbies and activities, identifying what leads to your urges to drink and having a plan to handle urges, and identifying a strategy for saying “no” to an alcoholic beverage in social settings.The Conversation

Nikki Crowley, Assistant Professor of Biology, Biomedical Engineering and Pharmacology, Penn State

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With more Americans able to access legalized marijuana, fewer are picking up prescriptions for anti-anxiety medications – new research

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theconversation.com – Ashley Bradford, Assistant Professor of Public Policy, Georgia Institute of Technology – 2025-01-10 07:26:00

New research suggests that in some states, medicinal cannabis use could be leading to a reduction in the use of anxiety medications.

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Ashley Bradford, Georgia Institute of Technology

In states where both medical and recreational marijuana are legal, fewer patients are filling prescriptions for medications used to treat anxiety. That is the key finding of my recent study, published in the journal JAMA Network Open.

I am an applied policy researcher who studies the economics of risky behaviors and substance use within the United States. My collaborators and I wanted to understand how medical and recreational marijuana laws and marijuana dispensary openings have affected the rate at which patients fill prescriptions for anti-anxiety medications among people who have private medical insurance.

These include:

  • Benzodiazepines, which work by increasing the level of gamma-aminobutyric acid, or GABA, a neurotransmitter that elicits a calming effect by reducing activity in the nervous system. This category includes the depressants Valium, Xanax and Ativan, among others.

  • Antipsychotics, a class of drug that addresses psychosis symptoms in a variety of ways.

  • Antidepressants, which relieve symptoms of depression by affecting neurotransmitters such as serotonin, norepinephrine and dopamine. The most well-known example of these is selective serotonin re-uptake inhibitors, or SSRIs.

We also included barbiturates, which are sedatives, and sleep medications – sometimes called “Z-drugs” – both of which are used to treat insomnia. In contrast to the other three categories, we did not estimate any policy impacts for either of these types of drugs.

We find consistent evidence that increased marijuana access is associated with reductions in benzodiazepine prescription fills. “Fills” refer to the number of prescriptions being picked up by patients, rather than the number of prescriptions doctors write. This is based on calculating the rate of individual patients who filled a prescription in a state, the average days of supply per prescription fill, and average prescription fills per patient.

Notably, we found that not all state policies led to similar changes in prescription fill patterns.

The effects of benzodiazepines on the brain have to do with their ability to bind to the receptors of the neurotransmitter GABA.

Why it matters

In 2021, nearly 23% of the adult U.S. population reported having a diagnosable mental health disorder. Yet only 65.4% of those individuals reported receiving treatment within the past year. This lack of treatment can exacerbate current mental health disorders, leading to increased risk for additional chronic conditions.

Marijuana access introduces an alternative treatment to traditional prescription medication that may provide easier access for some patients. Many state medical laws allow patients with mental health disorders such as post-traumatic stress disorder, or PTSD, to use medical cannabis, while recreational laws expand access to all adults.

Our findings have important implications for insurance systems, prescribers, policymakers and patients. Benzodiazepine use, like opioid use, can be dangerous for patients, especially when the two classes of drugs are used together. Given the high level of opioid poisonings that also involve benzodiazepines – in 2020, they made up 14% of total opioid overdose deaths – our findings offer insights into potential substitution with marijuana for medications where misuse is plausible.

What still isn’t known

Our research does not clarify whether the changes in dispensing patterns led to measurable changes in patient outcomes.

There is some evidence that marijuana acts as an effective anxiety treatment. If this is the case, moving away from benzodiazepine use – which is associated with significant negative side effects – toward marijuana use may improve patient outcomes.

This finding is critical given that about 5% of the U.S. population is prescribed benzodiazepines. Substituting marijuana has the potential to result in fewer negative side effects nationwide, but it’s not yet clear if marijuana will be equally effective at treating anxiety.

Our study also found evidence of a slight – albeit somewhat less significant – increase in antipsychotic and antidepressant dispensing. But it’s not clear yet whether marijuana access, particularly recreational access, increases rates of psychotic disorders and depression.

While we found that, overall, marijuana access led to increased antidepressant and antipsychotic fills, some individual states saw decreases.

There is a lot of variation in the details of state marijuana laws, and it’s possible that some of those details are leading to these meaningful differences in outcomes. I believe this difference in outcomes from state to state is an important finding for policymakers who may want to tailor their laws toward specific goals.

The Research Brief is a short take on interesting academic work.The Conversation

Ashley Bradford, Assistant Professor of Public Policy, Georgia Institute of Technology

This article is republished from The Conversation under a Creative Commons license. Read the original article.

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