Are you thinking about investing your money into something worthwhile? Do you want to make wise investments and, at the same time, make the world a better place?
Why not invest your time and money in socially responsible investments? This will allow you to place your wealth in an organization that aligns with your beliefs and values. Moreover, investments of this nature will reflect greatly upon your portfolio.
Continue reading to learn what you need to know about sustainable and responsible investing.
What Is Sustainable and Responsible Investing?
Sustainable and responsible investing is a popular strategy that takes into consideration environmental, social, and governance (ESG) factors in making decisions and securing ownership. We also refer to this practice as socially responsible investing (SRI), which can also double as an acronym for sustainable, responsible, and impact investing. These days, making significant, positive social changes and getting financial returns as an investor has become increasingly feasible and profitable.
We advise investors who are interested in SRI to look beyond the typical metrics such as performance and expenses. It’s important to find a business that aligns with your values, and this can be determined by looking into a company’s revenue sources. Depending on an investors’ values, SRI can be defined differently.
What Are Some Examples of Socially Responsible Investments?
Here at White Raven Financial, we help individuals invest in socially responsible investments that can create a major impact on society. When implementing SRI, we encourage investors to look for companies that seek to address ESG issues, particularly in areas in which you identify with or feel strongly about.
Social Justice
Investing in social justice impact is a primary step towards making the overall social environment better. This entails investing in companies that have a clean record of no human rights violations or practice important concepts such as wage equality and gender equality.
Morality
When thinking of making a responsible investment, you must evaluate a company’s actions and determine whether or not their performance aligns with your commitment to morals. We call this avoiding “sin stocks,” which refer to shares involved in unethical activities such as gambling, liquor, and pornography.
Environment
If you’re interested in investing in a company that helps preserve the environment, we recommend looking for organizations that choose alternative energy sources, such as wind or solar power. Another way you can approach this is by looking into companies that seek to combat climate change and environmental destruction.
Peace
Individuals who wish to make a movement on peaceful developments should avoid organizations that cause negative ramifications on future generations and instead focus on positive and sustainable development. We advise staying away from companies that make weaponry or profit from foreign conflict.
Health
Investing in companies that promote good health involves avoiding those who sell tobacco, alcohol, or even anything that contains GMOs. There are also tons of investment opportunities in facilities that give access to health services, medicine, and technology.
What Are the Different Strategies When Making Responsible Investments?
There are different ways to instigate a sustainable social influence, and we’re here to provide you with any assistance in finding the approach that works best for you.
Negative Screening
This means refusing to put your time and money into companies that don’t meet your social standards. A more extreme version of this may involve divestment, which is to pull all your assets out of certain companies because of the nature of their business or how they conduct it.
Positive Investing
Here, you work to identify a company that aligns with your values and are actively making contributions to responsible social change. Through this process, we can help you narrow down the most promising candidates in a given impact category.
Community Investing
This method focuses on investing in community-based organizations — most especially those in low-income areas — that provide needs such as safe and affordable housing, education, job opportunities, and more. You are essentially contributing your wealth to incite positive change in a specific community, which can even be your own.
Why Should You Make Sustainable Investments?
Besides allowing you to select investments based on your values and personal priorities, SRI also provides investment opportunities that establish financial, intrinsic returns that can’t be made anywhere else. These returns foster deeper emotional connections between you and your investing habits.
Choosing a socially responsible investment is powerful because it encourages investors to utilize their resources in a different, more positive way to create a better world. This sets the tone for what you want your portfolio and legacy to look like down the road.
Additionally, being able to resonate with your investments makes it easier for you to stay, even during uncertain periods when you might be tempted to sell or trade. You might even earn better returns, considering SRI uses a traditional financial analysis method to weigh potential returns. You not only help improve serious social and environmental issues — you’re also building wealth for many years to come.
When making sustainable and responsible investments, you are securing a formidable financial return that has major effects on the betterment of the environment and society as a whole. This entails extensive background research to make sure that your money is going to a company that truly aligns with your moral standards.
With your investments, you are one step closer to making the world a better place. It will take a lot of time and effort to settle on the right company to put your money into. To get started immediately, contact a socially responsible financial advisor today.
Sources:
*https://www.ussif.org/sribasics
*https://www.unpri.org/an-introduction-to-responsible-investment/what-is-responsible-investment/4780.article
*https://saylordotorg.github.io/text_the-sustainable-business-case-book/s16-01-introduction-to-socially-respo.html
*https://www.whiteravenfinancial.com/financial-services/socially-responsible-investing/
*https://www.cisl.cam.ac.uk/business-action/sustainable-finance/investment-leaders-group/what-is-responsible-investment
*https://online.hbs.edu/blog/post/sustainable-investing
