If you have an interest in saving the planet, you’ll be pleased to know that you can use Socially Responsible Investing (SRI) to invest your monies in socially responsible corporations and industries.
Socially responsible investing is a reminder that how you manage and invest your dollars is not only important to you and your family, it can also have an impact on the environment and even society.
The Definition of Socially Responsible Investing
Investing your money in an ethical, socially conscious way means that you’re placing it in investment vehicles that not only earn you money but also do something positive for others.
Ethical or socially responsible investing usually involves placing your dollars with companies that use environmentally friendly practices, employ diversity when hiring, and manufacture products that are healthy or “good” for consumers. Investing in products or goods that are sustainable would also fall into this category of investing.
For example, The environmentally friendly ESGV is an EFT that invests in assets that have sustainability standards. Its fund managers choose U.S companies, which must meet environmental and social criteria. This exchange-traded fund holds about 1400 stocks with well-known brands such as Apple (AAPL).
If you want to learn more about investing and its basics, check out this great post on Investment fundamentals.
After you are well educated, a great way to invest in stocks without fees is to check out Webull. While you are practicing SRI, you can Get 3 free stocks valued at up to $6300 by opening & funding a #Webull brokerage account.
How is it Possible to Invest Only in SRIs?
This question is tricky because many companies are not socially conscious. This is important to keep in mind when you invest in mutual funds. Often it can be difficult to determine if all the companies represented in the mutual fund fall into the SRI category.
The best way to invest consciously is to do some homework online to ensure the companies or mutual funds you wish to invest in engage in ethical practices before consulting with stockbrokers and financial planners.
Also, through a process called, “screening,” investors and financiers evaluate companies based on how they perform socially and ethically using specific criteria to measure those elements. Corporations that receive less than satisfactory social responsibility performance scores may not gain investment dollars from ethical investors.
Where and How to Find SRI Companies/Investments
Recently, several socially responsible mutual funds have become available. Major investment companies such as Calvert and Van Eck Global offer socially responsible investments to their customers.
Some investment companies totally focus on offering environmentally friendly/SRI investment products. Portfolio 21 Investments, SRI Wealth Management Group, Parnassus Investments, and Appleseed Fund are a few of those companies.
In addition, various websites specialize in getting the word out about SRIs. Social Funds website is one such example.
Factors to Bear in Mind When Considering Investments in SRIs
Your personal values
Keep in mind your personal values about sustainability, human rights, employee treatment, and societal good as you make decisions about your investments. Carefully review company brochures, statements, and annual reports to get a feel for their investment environment before investing your dollars.
Possibilities for growth
Remember that your main reason to invest is to make your money multiply. Even though your values steer you toward SRIs, ensure that you are making the best investment possible for your money.
Higher fees
Because it costs more to perform tasks ethically and responsibly, don’t be surprised if you pay higher fees to invest in SRI companies and mutual funds.
There is much to know about making socially responsible investments. When you’re about to make any investment, do your homework, consider your personal values, think about the possibilities for growth, and determine your investment costs. With this strategy, your investments work both for your family and the good of the world we live in.
