Whether it’s termed ethical, responsible or sustainable investing, the aim is generally the same. It’s investing your money in businesses which have some intention of making the world a better place. In the past, ethical investing was the only option if you wanted to invest in companies aligned to your values. But this ‘good money’ sector has moved on a lot in recent years.
Society and the environment
Ethical is now just one of many options you can choose from. Green and ethical investments look at the wider impact of investing on society and the environment when seeking financial returns. They take into account social or environmental considerations in addition to financial criteria.
Just as you can now choose from a range of green or ethically produced goods in your local supermarket, you can also choose financial products that have positive benefits for the environment and society.
Green and ethical investments allow you to have a positive impact on the world around you. Green and ethical investments may promote greater corporate responsibility, invest in solutions to 21st century problems, or contribute to cleaner, greener profits.
Values-based investment funds enable you can make positive financial decisions that support your values and morals
Ethical – tends to follow a moral-based screening process that excludes industries such as tobacco, gambling and armaments, while seeking companies that contribute positively to the environment and society.
SRI – sustainable and responsible investment seeks to invest in the most sustainable companies, i.e. those that manage their environmental, social and community impacts for the greater good of society.
Impact – invests in companies that aim to achieve a measurable positive social or environmental impact in addition to a financial return.
Green – invests in companies involved in improving the environment.
Shariah – derives its principles from Shariah Islamic law. To comply with Shariah, investment is not allowed to earn interest.