What is Ethical Investing?

Ethical investing means choosing investments that reflect socially responsible values.

There are three broad approaches to ethical investment:

1. Negative

These funds will typically avoid companies involved in or supporting areas such as:

• The arms trade
• Nuclear power/fuel
• Repressive regimes
• The tobacco industry
• Anti-trades union activity
• Animal experimentation
• Third World debt/exploitation

2. Positive

This is where fund managers will actively seek to invest in companies whose products or services are of long-term benefit to the communities in which they operate and/or contribute to a better environment, these might include:

• A good safety record
• Openness about corporate activity
• Pollution control
• Energy conservation
• Production of recycling equipment
• Equal Opportunities Policy

3. Dialogue and Engagement

These encourage more responsible business standards when there is a strong business case for change. This approach can be taken separately to or in combination with individual company screening. In this process fund managers will engage on areas such as:

• Inappropriate remuneration
• Social responsibility
• Climate change

Whichever combination of approaches you decide to take, it is important to get independent advice from a qualified, Independent Financial Adviser experienced in ethical investments such as Island Financial Solutions Limited.

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• Ethical Investments
• What is Ethical Investing?
• The history of Ethical Investing
• Does it make a difference?
• Ethical Funds
• Performance
• How can I invest ethically?
• How IFS can help
• Ethical Investing menu

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