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Ethical Investing

Lesley Scorgie

Posted Jun. 27, 2008
Tagged: Money, Investment

Hi Everyone,

In a random coffee shop conversation last week, I was asked about ‘green’ investing. Going ‘green’ is a hot topic with a variety of favorable outcomes. In this post, I am going to discuss the broader concept of ethical investing.

Ethical investing has been around since the 1700s. It’s an investment style designed to make money while achieving social good. Ethical investing encompasses the protection of people, health, environment, and human rights. Ethical investors typically avoid companies involved in 1) harming the environment, 2) causing (directly or indirectly) illness, disease and death and/or 3) demonstrating harm and disrespect to human rights. Many ethical fund managers avoid businesses involved in tobacco, alcohol, gambling, and the development of weaponry. ‘Green’ investing, focuses specifically on environmental protection.

There are three strategic approaches to ethical investing. First, you can divest your interests and pull your money out of an unethical situation. You can screen out certain investments and avoid including them in your portfolio altogether. Lastly, you can become a shareholder activist, and thus attempt to produce change through advocacy and shareholder voting rights. If you don’t have time to manage your investing strategy, for a fee, you can always turn to professional money managers for help.

It’s possible to make money in the ethical investment market. But, the performance results are ‘hit and miss’ and many of these funds don’t have more than ten years worth of performance data – an essential element when making an informed investment choice. So, I’d encourage a thoughtful consideration of fund history, management, and future direction before you take the plunge.

Ethical investing is gaining momentum across all markets, so keep an eye on these opportunities.

All the best,
Lesley Scorgie

Lesley Scorgie is the bestselling author of Rich by Thirty: A Young Adult’s Guide To Financial Success published in January 2007 and printed in English, French and Korean. Lesley owns and operates Rich By Inc., a financial consulting company dedicated to providing education, resources and tools for a variety of demographics. Lesley’s passion is to encourage financial literacy, a topic she has enthusiastically promoted through speaking and writing since 2001.

She has made numerous television appearances including The Oprah Winfrey Show and Montel Williams, and her financial writing has appeared in publications such as Unlimited magazine, the Calgary Herald and the Calgary Sun. Lesley has worked in the banking and securities industries and as a spokesperson for Canada Savings Bonds.

In 2005, Lesley Scorgie graduated from the University of Alberta with a Bachelor of Commerce degree in marketing and finance. She currently works diligently to promote financial literacy through speaking, educating and writing. In addition to this Lesley dedicates substantial time, energy and resources to non-profits within her community. See Lesley Scorgie's other posts and profile.

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1 Comment

Helen Anderson
09/16/08 10:27 AM

We just posted an article, “6 Safe Places to Invest Your Money” (http://www.bankaholic.com/606/low-risk-places-i... I thought I'd bring it to your attention in case you think your readers would find it interesting.