There are funds which merely exclude investment in specific activities or industries such as tobacco, gambling, alcohol and armaments. Others take a more pro-active stance, actively looking to invest in companies involved in environmentally sound, socially progressive businesses.
A third way, which evolved in the late 1990's, goes further. it is based on the belief that ethical or socially responsible investment should go beyond the 'avoidance' or 'supporting' approaches described above. Often called an 'engagement' or 'influencing' approach, here the investment fund will not apply any screeninig criteria to its investment choices. Instead, the fund manager undertakes to create a dialogue with a certain numbe of companies in the portfolio on a specific number social and environment issues. The aim is to encourage them to adopt the business practices. Those companies which are already demonstrating a good performance in this area are encouraged to continue to set the highest standards.
There are two main reasons why you would consider investing in ethical investment funds. First, you may feel it appropriate that your investment decisions should mirror your own personal views and behaviour. Ethical investment helps you to invest according to your principles. Second, by investing 'ethically' you can gently influence companies to improve their ethical record. Like it or not, money makes the world go round. If companies found that unethical behaviour caused investors to withdraw their money, it would make them think twice.
We can assist you to find out all you need to know and recommend the right product for your needs. Please e-mail us for further information and complete independent and unbiased advice.
Levels and bases of, and reliefs from, taxation are subject to change.
|
