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Our Best GIC Rate as of June 3, 2008
is
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Over 18 different issuing companies to
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(rates subject to change without notice) |
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 Your
Money
Matters
June
2008 Issue
Socially Responsible Investing – An
Overview
Socially
responsible investing (SRI) is often referred to as a holistic
approach to investing because it looks at financial, social,
environmental and ethical criteria in choosing investments. An
increasingly hot topic these days, it is by no means a black and
white issue.
Advocates
of SRI believe that it is quickly moving into the mainstream and
that the corporate “bottom line” is about to get a whole lot bigger.
By this, they mean that companies will not only have to ensure they
are doing well financially, but in order to remain competitive in
the marketplace, and please their shareholders (who are becoming
more and more concerned about what kinds of companies they invest
in), they will be forced to look at the impacts of their actions on
the environment and the communities in which they operate.
Opponents
of SRI, on the other hand, claim that it restricts an investor’s
portfolio mix by limiting his or her investment choices and is,
therefore, more risky as a result. The screening processes that fund
companies use to select socially responsible investments are often
criticized as well.
Because
people have very different sets of beliefs, SRI fund managers must
choose the right set of stocks to attract the greatest number of
investors. To do this, each fund uses a set of “screens” or
selection criteria. One fund might base its screens mainly on
environmental aspects, while another might focus on human rights.
There
are four methods of Social Investing: Negative screening which
chooses not to invest in companies that act “unethically” or
irresponsibly, positive screening which chooses to invest in
companies that do something to stop human rights abuses, help the
environment, support the community, etc, community investment which
chooses to invest money in community development or micro-enterprise
initiatives that contribute to the growth and well-being of specific
communities, and shareholder advocacy “an important aspect of SRI”
which focuses on the ability of investors to influence change
through their shares in a company. Because corporations use a
“one-share-one-vote” principle, each shareholder can have their say.
They can write letters to management, attend the company’s annual
general meeting, vote and introduce shareholder resolutions.
Don’t
let your emotions be your only source of investment advice. Not all
companies that “do good” are smart financial investments. Being a
responsible investor means considering all the criteria – not just
the social indicators but the financial ones as well (including
fees). Always do your homework before making any new investment
decisions. Be true to your own values and beliefs. What’s important
to you might not be important to your neighbor. Identify your top
concerns and choose the fund that most closely matches your own
value system. Don’t put all your eggs in one basket. With SRI, you
may find your investments have too much in common socially,
ethically and financially. Be vigilant about diversifying your
portfolio. There are many ways to invest in socially responsible
companies while minimizing risk.
If
you or someone you know would like to get more information on this
subject and which funds are available to invest in, please contact
us. We would be happy to send you some information or set up an
appointment to discuss in greater detail.
Theresa Wever and the Money
Concepts Team.
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Russell Location |
Vankleek Hill
Location |
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1087 Concession Street, P.O. Box
269
Russell ON K4R 1E1
Tel: (613) 445-8624 |
116 Main Street
East, P.O. Box 459
Vankleek Hill, ON K0B 1R0
Tel: (613) 678-3861 |
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Toll-Free:
1-800-250-5557 -
www.moneyconceptsrv.com |
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