Investment Advice – Ethical Issues

For some investors, ethics are a very strong driving force that directs them to which places they want to have their money invested in. If you do not believe in what a corporation practices, you will be hesitant to invest your own personal finances into their stocks. Personal beliefs can be an amazingly strong force when it comes to investing.

Most ethical investors tend to seek out companies that strive to make a positive contribution to this planet instead of companies that tend to harm the world, the people or the wildlife that exist here. It can be a tricky situation when trying to find ethical companies to invest money in since most are hard to judge the ethicality based on a stock profile alone.

Specifically, ethical funds are typically held and managed through an investment fund as a unit trust, life insurance or pension fund. Mainly, they exclude funds that exist in industries such as gambling, tobacco, alcohol and the likes. These are very generalized and may not draw the increased dividends that unethical funds may produce over the course of your investment. This is more of an ‘avoidance’ way to invest ethically.

Pro-actively, some investors will seek out companies that are actively involved in environmentally solid procedures and socially acceptable behaviors. Investors who have a connection with the company’s ideals or beliefs generally support these specific genres. Vegetarians would typically invest in companies that do not promote the raising or distribution of meat and meat by-products.

One approach that many investors have taken since the early 1990’s goes further than avoiding unethical companies or supporting the ones that are already active. Using an influencing approach to investment opportunities, the fund manager will engage with a certain number of companies regarding many specific social and environmental issues. This is in the hopes to show them better business practices and to continue to set a higher standard than that which is needed in order to strive for a more ethical stand in the market.

For those who decide on ethical investments only, you can rest assured that you will not be supporting those who deteriorate society and mankind with your hard-earned money. You will be showing others that not only is your money working for you, but you are using it to encourage others with the same beliefs as you to continue to do what they do best for this planet and those living on it.

If everyone took a stand to only invest in ethically profound companies, many corporations would see how powerful a person’s beliefs and ethics really are. Money speaks louder than words and if all investors were to move their assets from those who do not enlist in ethical practices, many companies would feel the difference and essentially be encouraged and forced into taking responsibility for their own procedures. Never feel that your money, no matter how little or how much you decide to invest cannot have an effect on the market. Every dime you invest in a company should be there because you want it to be there, not because an investor told you it would be a good idea.