There are many Socially Responsible Investment options and it is important to review all of them carefully to choose the best ones.
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You may have heard the term Socially Responsible Investing (SRI) before, but weren’t sure what it was all about.
Many people have made the decision to include their personal beliefs, value system and societal concerns into their everyday lives. However, many people are not aware that this can be translated into their investment decision making process as well. SRI considers both the positive and negative social and environmental consequences of investments.
SRI recognizes that corporate responsibility and societal concerns are valid parts of investment decisions. SRI considers both the investor's financial needs and an investment’s impact on society. SRI investors encourage corporations to improve their practices on environmental, social, and governance issues.
As a result of its investing strategies, SRI also works to enhance the bottom lines of the companies in question and, in so doing, may deliver more long-term wealth to shareholders. With SRI, investors can put their money to work to help build a more sustainable world while earning competitive returns both today and over time. Socially responsible investors include individuals and also institutions, such as corporations, universities, hospitals, foundations, insurance companies, public and private pension funds, nonprofit organizations, and religious institutions.
One of the key elements of SRI involves Social Screening. These screens include both positive and negative screens in the process of evaluating investment portfolios based on social, environmental and good corporate governance criteria. It is a common mistake to assume that SRI "screening" only involves negative screens. However, in many cases, social investors seek to own companies that make positive contributions to society.
Conversely, many social investors avoid investing in companies whose products and business practices are harmful to individuals, communities, or the environment. Some of the more common screens include ATF (Alcohol, Tobacco and Firearms), Environmental Performance, Animal Welfare and Labor Relations to name a few.
Many of the SRI assets are in separate accounts, portfolios managed for individual clients which allow the client to screen issues based on their individual beliefs and values. This allows a greater customization so that only issues that impact the investor as an individual are screened versus screening in a “cookie cutter” manner that may not directly align with the investor’s goals and beliefs.
The bottom line is that Socially Responsible Investing can be good for the client, lead to good corporate citizens and make a difference in society. If you are currently “talking the talk” of SRI, now may be a good time to review your investment strategy to ensure you are “walking the walk” as well.
Past Performance does not guarantee future results.
Securities and advisory services offered through SII Investments, Inc. (SII), member FINRA/SIPC and a Registered Investment Advisor. SII Investments, Inc. and Peabody Financial Services, Inc. do not offer tax advice and are separate and unrelated companies.
Many people have made the decision to include their personal beliefs, value system and societal concerns into their everyday lives. However, many people are not aware that this can be translated into their investment decision making process as well. SRI considers both the positive and negative social and environmental consequences of investments.
SRI recognizes that corporate responsibility and societal concerns are valid parts of investment decisions. SRI considers both the investor's financial needs and an investment’s impact on society. SRI investors encourage corporations to improve their practices on environmental, social, and governance issues.
As a result of its investing strategies, SRI also works to enhance the bottom lines of the companies in question and, in so doing, may deliver more long-term wealth to shareholders. With SRI, investors can put their money to work to help build a more sustainable world while earning competitive returns both today and over time. Socially responsible investors include individuals and also institutions, such as corporations, universities, hospitals, foundations, insurance companies, public and private pension funds, nonprofit organizations, and religious institutions.
One of the key elements of SRI involves Social Screening. These screens include both positive and negative screens in the process of evaluating investment portfolios based on social, environmental and good corporate governance criteria. It is a common mistake to assume that SRI "screening" only involves negative screens. However, in many cases, social investors seek to own companies that make positive contributions to society.
Conversely, many social investors avoid investing in companies whose products and business practices are harmful to individuals, communities, or the environment. Some of the more common screens include ATF (Alcohol, Tobacco and Firearms), Environmental Performance, Animal Welfare and Labor Relations to name a few.
Many of the SRI assets are in separate accounts, portfolios managed for individual clients which allow the client to screen issues based on their individual beliefs and values. This allows a greater customization so that only issues that impact the investor as an individual are screened versus screening in a “cookie cutter” manner that may not directly align with the investor’s goals and beliefs.
The bottom line is that Socially Responsible Investing can be good for the client, lead to good corporate citizens and make a difference in society. If you are currently “talking the talk” of SRI, now may be a good time to review your investment strategy to ensure you are “walking the walk” as well.
Past Performance does not guarantee future results.
Securities and advisory services offered through SII Investments, Inc. (SII), member FINRA/SIPC and a Registered Investment Advisor. SII Investments, Inc. and Peabody Financial Services, Inc. do not offer tax advice and are separate and unrelated companies.
About this column:
Rudolf "Rudy" Van Oeveren is the president of Peabody Financial Services, Inc., a local independent financial planning firm. Peabody Financial Services was founded in 2002. You are encouraged to submit questions that you want answered through this medium. Questions can be forwarded to rudy.vanoeveren@siionline.com.
