socially responsible investing - balancing social values with financial goals
TRANSCRIPT
SOCIALLY RESPONSIBLE INVESTING - BALANCING
SOCIAL VALUES WITH FINANCIAL GOALS
In recent times, there has been a growing interest and curiosity in the concept of
‘socially responsible funds’. This has lead investment companies offering mutual funds and similar financial products to
grow their portfolios to better serve their clients.
As a way to keep abreast of changing investment habits, as it relates to social values, investment companies recently
surveyed potential clients. The majority of the responses were from women and people under the age of forty-nine. These responses indicate that investors believe having choices to be socially responsible in their investments
is important.
Traditional core tenets still remain the standard, such as to increase long-term
profits through positive customer experience, and incorporate high ethical standards. However, the new socially responsible investor is looking for corporate social
responsibility strategies that go beyond the standard. Investors are looking for
companies that have a proven positive social impact on consumers, employees, and
communities. Socially responsible investing is any
investment strategy that seeks to consider both financial and social return.
Investing based on social ideals is gaining ground. In the United States, at least $7
trillion is invested in strategies focused on the environment, social and corporate
governance or values, according to Envestnet PMC. That is up from $639 billion
in 1995 and $3.7 trillion in 2012.
PUTTING INTO A SOCIAL CONTEXT
Fund offerings may differ widely. It is up to the investor to do their due diligence and investigate
the social practices of the company they are looking to invest in. Over the long-term, these
practices may impact the net return on investment, sustainability of the fund, and whether
the company practices the level of social responsibility the investor is looking for.
There are often social tradeoffs when it comes to corporate social practices. A company
may invest heavily in emission controls at the cost of worker wages or benefits. Some new
technologies that purport to be a more environmentally sustainable, or friendly, actually consume more energy or deliver more waste in product development than
what is predicted to benefit society.
In the matter of socially responsible investing, investors often seek companies that share similar values, but similar values don’t always translate
into equal comparisons. For instance, comparing a company in the financial sector with a company in the manufacturing sector, with the same yardstick,
will not lead to an accurate appraisal of the company or to sound socially responsible
investing decisions.
LEVEL OF SOCIAL RISK VS RETURN ON SOCIAL
INVESTMENTMatching funds with investor expectations needs thorough examination. As a socially
responsible investor, setting limits on exposure, or risk tolerance is important. A socially responsible investor may wish to
invest in funds that have strict environmental standards; however these
standards may differ from country to country where the company is located. Is the investor okay with this varying degree of exposure or varying degree of positive
social impact?
For more information visit our website:- http://www.trikletrade.com/
Business Details:-Contact Person:- Syann StevensBusiness Name:- Trikle Trade
Business Email ID:- [email protected]
Business Address:- P.O. Box 1976 Missoula, MT 59806