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Mutual Funds

Socially Responsible Mutual Funds

“We have to shift our emphasis from economic efficiency and materialism towards a sustainable quality of life and to healing of our society, of our people and our ecological systems.”

-Janet Holmes a Court

Investing can have a dark side. There are plenty of shady business ventures which may not be legally but are definitely not moral. There are people out there who believe that to get ahead in business, investing, and life you have to do unpleasant things.

However, there are plenty of ways to make a profit, and be successful in business without losing who you are and adhering strictly or you ethics. If you are concerned about the ethics behind investment ventures there are many websites which list out and offer researched based no just on corporate success but also on their moral compass.

Believe it or not there are socially responsible mutual funds out there. These type of mutual funds belong to companies which make it a point to be socially, morally, and environmentally responsible their actions and the actions of their employees. Many of these companies also contribute a great deal of money to their community and socially important issues. There are several things you can do, as a socially responsible investor, to make sure the stocks you are investing in belong to a socially responsible corporation.

There are fund managers that have the sole responsibility of seeking out and create good mutual funds which are both profitable and socially responsible. They only let corporations into their mutual funds if they exhibit certain behaviors which adhere to the goals of the fund and the demands of the investors.

For example, if a mutual fund has a goal to be environmentally friendly, it will seek out corporations which follow all the environmental laws, rules, and are active in environment preservation. They would exclude companies which test on animals or support nuclear power.

For example, funds with a strong sensitivity towards issues of environmental concern will specifically pick stocks in companies who go beyond fulfilling environmental requirements, but the fund will most likely invest also in companies whose practices reflect other concerns, such as animal testing or nuclear power.

Shareholder activism is something that is taken very seriously. Not only do these people invest in these corporations but make a point to get personally involved. Investors will try to persuade companies to behave in a socially responsible way through letters, suggestions, policy meetings, proposal, and using voting rights.

The power of shareholder activism lies in the number of being that are invested in making a change. A couple of people are just seen as a nuisance. If you have ten thousand people, real investors, who are pressuring a company to change it’s policies – things will get done.