Profiting with a clear conscience
Growing your capital and income are naturally important to you as key investment objectives, but for some people the means by which their wealth is generated also influences their choices. A growing number of our clients prefer to avoid investing in companies they see as profiting from activities regarded as undesirable.
In its early days, ethical investment appeared suited only to a small minority of investors, but it has long since become mainstream. Now a lot of professional investor attention focuses on environmental, social and governance (ESG) issues and over 1,000 asset managers and owners subscribe to UN-backed Principles for Responsible Investment.
What all this means for you as an investor is that if you wish to avoid buying into companies that profit from such products and services as tobacco, alcohol and gambling for example; or operate in a way that threatens environmental damage, it should be possible to structure your investment portfolio in a way that meets your preferences.
Shutting out certain companies from your portfolio need not be detrimental to your investment returns; ethical funds may outperform or underperform in comparison to other funds over different periods of time. Rising concerns over climate change and global health may further support the ethical trend. Find out more from your adviser.