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Socially responsible investing

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By Gurdit Singh


The latest buzz word in the word of investing is SRI which is known as the socially responsible investing and it is also known as the sustainable investing or the green investing or the ethical investing. The way the socially responsible investing has grown that these people who invest think about the society at large and of course look at financial gains though but the main emphasis is on three fronts which is social responsibility as well as community investing.

These investors will look for companies that have good human rights records or have good employee employer relationships as well as have very good way of handling the social impact of their policies. Most of the Sri investors will shun companies that are involved in the business of Alcohol, tobacco, gambling, military etc.

The current trend is that there are mutual funds which are known as ethical mutual funds or the socially responsible mutual funds which have total of 207 billion dollars of assets under management

The social responsible investing such as The Calvert investing have taken proactive approach to investing and have forced companies to ban say child labor in countries like Uzbekistan. The there are other companies which have been told to ban the child labor in the factories in China and India. The example being the factories of Nike or the carpet factories in India.


Another way to get to known all about Sri is that you should read the book which is the

Socially Responsible Investing: Making a Difference and Making Money by Amy Domini. This is a good book with in depth analysis of the way the SRI investing can make a difference in the word

The challenge in the socially responsible investing is that you will have to apply screens so that you can find the company that are prefect and that is why it is tough to find the perfect companies in the world. The way to here is to either buy some socially responsible mutual funds or if you think that they do not your ethical principles then make sure that you have the best companies which match your ethical and moral principles.

Most of the companies engage in a there pronged strategy and that is that they have the screening first then have the social advocacy groups who work in tandem with the companies management to convert them in socially responsible organization. That may include working with them to correct the human rights records or get them to go greener.

If you are investor who is looking to invest in the socially responsible companies then your best bet is to go for the mutual funds and join the action in community investing else it will be very tough for you to find out the companies all by yourself which are ethical and enforcing a good agenda all by yourself will be very tough.

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