Socially Responsible Investing is emerging as an important player in the investment world. Also known as sustainable or ethical investing, its approach is to balance achieving financial returns with influencing social change across the gamut of environmental and social issues.
People are becoming more conscious of the impact their decisions have on the environment and society, and it’s no different when it comes to investments. Socially Responsible Investing involves seeking out companies that are active in these social and environmental arenas, whether it be through providing access to jobs or manufacturing with alternative/clean energy.
Community investments are aimed at helping economically disadvantaged people in both rural and urban areas by providing financial services through community-developed banks, credit unions, loans and microfinance institutions. Community investments provide much-needed access to financial resources and create economic stability for growth in these communities through programs that cover the likes of job creation, affordable housing and community renewal.
Through shareholder resolutions, shareholders can have their voice heard, redirecting publicly-traded companies towards paths more amenable to societal or environmental concerns and away from practices that are unsustainable or unethical. A recent example involved Fluor, where shareholders defeated the board and forced the company to report on its political spending.
How can you make a difference?
It’s becoming much easier and more commonplace to invest this way. According to the US SIF Foundation’s Report on Sustainable and Responsible Investing Trends in the United States, $8.72 trillion in total assets at the end of 2015 were held in socially responsible investments.
Where can you find, community investing financial institutions?
Go for good and savvy investing!