Socially Responsible Investing In The Environment
For a very long time, money used for good will was called charity, while money used to earn more money was called investing. That’s not the case anymore.
Today, the two concepts are forming into a financial arena called socially responsible investing. Both investors and mutual fund companies are implementing this new idea and discovering that they can be profitable and at the same time do some good for the environment and society.
Bob Guthrie, an investment broker with A.G. Edwards in Burlington, Vt. says, “Socially responsible investing means you don’t have to compromise your own personal beliefs to make money on Wall Street – whatever those beliefs are.”
Guthrie says that the idea of selectively choosing stocks for social reasons dates back to the early 1900’s. That’s when church members grouped together and refused to invest in tobacco or alcohol companies. He adds that the trend continued with investors ignoring corporations involved in the Vietnam War and those companies investing in South Africa.
But growth in this type of investing has mushroomed during the past few years as more and more investors have moved social consciousness into the mainstream of investing. And the impact is being felt.
With help from stockholders, business practices concerning the environment are starting to change, said Rob Kruger, vice president of portfolio management at Progressive Asset Management. While the issues may vary, he said companies are realizing they will suffer if they aren’t viewed as being socially responsible.
“As this investing community continues to grow, a lot of proposals are being put forth by investors at annual shareholder meetings,” Kruger said. “A whole range of issues and activities is now being addressed.”
As part of its operation, Progressive Asset Management conducts research for socially responsible and eco-friendly mutual funds. The firm screens companies for environmental problems or nuclear involvement… whatever social issues their clients want investigated.
“As the clock ticks, companies are becoming more and more cooperative with us,” Kruger said. “A lot of them are now very anxious to talk about these social and environmental issues.”
Guthrie agrees that business practices are changing and says American companies are aware of shareholders who are concerned with the environment.
He advises, “Make sure your hard-earned money is not invested in companies with little concern for the environment. Keep these things in mind when you invest and the corporations will do the same too.