Thursday 29th July 2010

What is Ethical Investing?

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

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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News Feed: BBC News - Business



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