Socially responsible investing (SRI), also known as sustainable, socially conscious, “green” or ethical investing, is any investment strategy which seeks to consider both financial return and social good.
Most people want to invest in companies that do well and bring them profit, through dividends or increased value of their shares, when they come to sell. They are looking to grow their money at whatever the cost to the world.
If you want to participate in ethical investing, then you are making a choice of the companies that you are investing in. There are principals that ethical investors are looking for which are not involved in the following areas: alcohol, tobacco, gambling, pornography, weapons and military.
When it comes to investing your money, it is up to you as to the company that you choice to invest in. If there are aspects of a company that you don’t like, then it is your choice if you invest in that company. You have to be comfortable with the decisions that you make. You have to justify your own ethics if the company is going to suite your needs.
You may feel that a new CEO of a company isn’t the best person, you might think their employment will not benefit the company. You must carefully consider whether to invest, in those circumstances. It is the same with the company ethics, if they don’t match how you feel about business then it is purely your choice not to invest in the company.
It is these choices that form the basis of ethical investing; you have to be happy with the choices that you are making. If you are investing in a company, then it is a good idea that you are comfortable with the decisions they are making, with your money.
Why choose ethical investing
There are many reasons why you can choose to invest in an ethical way. If you are looking at your investments for retirement, then it would make sense for the investments that you choose will mean a better place in which to live, when you get to the point of retirement.
There are investment products that will invest your money in companies and businesses that follow a certain credentials. This type of investment options give you the chance to invest in a wide variety of companies, that follow the ethics you adhere to. It will mean, as well, that you have the opportunity to invest in a larger number of companies, with the risk of losing your investment reduced.
It is a way to invest in the markets but to still have your basic principles intact.
There are a wide number of different categories that can be named as green or ethical investing. It depends on the investment company as to how the companies are chosen for their portfolios. You can choose the amount of ethical information that will allow you to want to invest in that particular company. There is the option of best in sector, which is the company that has the best ethical polices in place. It can increase the amount of companies that you have available to invest in, but it could mean that you are investing in companies that have policies that are not in line with your ethical principles.