Got a New Attitude:
All About Ethical Investing
by sharon rockey
Investors today have a whole new attitude about ethical investing. A couple of decades ago, if you heard the words "investment" and "environmental responsibility" mentioned in the same sentence, it might have conjured up images of barefooted vegetarians trying to change the world with a few bucks. No disrespect to barefooted vegetarians, but that old image just doesn't hold up anymore.
Two recent studies prove that as a nation, we are more socially and environmentally conscious about how we spend and invest our dollars than ever before, and we expect those we invest with to adopt the same views.
In 2001, the Social Investment Forum Foundation reported that one out of every eight dollars under management in the U.S. is related to socially and environmentally responsible investments.
A recent Cone/Roper report conducted before and after September 11th, noted that almost eight in ten Americans today (79%) believe that companies have a responsibility to support causes -- up from 65 percent in March 2001, and nearly nine in ten Americans (88%) believe companies should continue supporting causes even during an economic downturns -- up from 71 percent in March 2001.
How do you support a worthy cause and profit too?
Here are some guidelines to get you started.
- Begin by identifying investments that are flexible enough to perform well in both up and down markets.
- Seek out savvy, reputable and well-seasoned individuals to manage your money -- when managers offer a "pay for achieved performance" compensation structure, the interests of both client and manager are the same.
- Since there is a greater sense of satisfaction when your investments are based on high values and personal interests rather than just your wallet, choose an investment that contributes to the social or environmental causes you feel most passionate about.
- If contributions to worthy causes are to be made from investment profits, check to see that the money is actually coming from the company's profits and not investor profits. After all, you have chosen to put your money in this particular investment partly because of the philanthropic nature of the managers, so you want to be sure your trust is well-placed.
- And finally, are the philanthropic objectives measurable? Ask to see a list of objectives and find out if the managers have the means to monitor the successful meeting of their objectives and to report back to the investors.
When you use choose the right investment and a qualified money manager who employs wise investment strategies and best management practices, you don't have to compromise your ethics to make a good profit. Invest with your values and your interests. The results can be profitable and very satisfying.
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