Socially Responsible Investing



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Best Socially Responsible Investment Sites

Full spectrum. Social offers extensive analysis of mutual funds that have a social agenda. The listed funds’ social objectives range from conservative to liberal. Some shun manufacturers of abortion-related products. Others focus on the environment and animal testing. lists both the funds’ goals and their financial achievements.

Mostly liberal. The Social Investment Forum site is more comprehensive, identifying socially responsible banks and financial planners as well as mutual funds. Its mutual fund analysis is more cumbersome, with separate charts for  funds’ social concerns and their monetary returns. The site does not list anti-abortion funds; its focus is mostly on liberal social issues.

Christian focus. For conservative Christians, the best site for selecting “values-based investments” is CrossWalk, which provides a rigorous analysis (but no chart) of whether hundreds of mutual funds and variable annuities invest in  “companies that profit from pornography, abortion, anti-family entertainment” or “actively promote” gay lifestyles.

Hodge-podge. Good Money is packed with information about many varieties of socially aware players on the financial scene, but the site is a hodge-podge.

Socially responsible companies. Few Web sites describe both companies’ effect on society and their financial performance. The following sites are no exception -- they focus more on individual companies’ social practices than on their finances. Most select companies by applying a relatively liberal viewpoint, focusing on the environment, workplace issues, human rights and avoidance of tobacco, alcohol, gambling and nuclear power. Investors choosing from any of these lists will have difficulties maintaining a well-diversified portfolio.

In presenting a list compiled for Green Money Journal, Good Money makes sure that investors know they are not getting "a list of companies with unblemished social records. There is no such thing as sainthood in the corporate world. The purpose of this directory is to identify Web sites maintained by or featuring publicly-owned companies that are followed by some investors, stock analysts, and portfolio managers who specialize in Socially Responsible Investing (SRI). It is also designed to illustrate the many different types of social issues that are of interest to those in the SRI movement."

Work + Family Connection Inc. compiles a list of "model companies" with progressive workplace policies. It was formerly provided free online, but no more. Now it's included in the group's "Special Report on Best Practices," a booklet that can be downloaded from the group’s home page for $35.

Cruelty Free Investment Newsdeclares that most lists of socially responsible companies are inadequate. As an alternative, it offers a few dozen publicly traded companies as its answer to the question, "Where would the animals want you to invest?" Some companies it labels "speculative," "risky short-term" or "relatively safe long-term" investments. Many are unlabeled, except for their animal-rights records.

Other lists of individual companies are maintained by the two prominent socially responsible mutual funds listed below.

Socially responsible mutual funds. Investing in mutual funds can help provide the risk-lowering diversification that's hard to achieve when investing in individual companies. 

Among the most prominent are those from Citizens Funds (with a list of 300 selected companies) and Domini Social Investments (with a list of 400).

Commentary and advice. The article "Stocks That Reflect Your Conscience" in the July 1999 edition of  Kiplingers Personal Finance magazine aptly describes the problems of finding a mutual fund that matches your personal description of what's "socially responsible." It also proposes some worthy companies of its own (without discussing how to avoid the problem of lack of diversification that can be created by investing in them). Though useful, the article does contain the amazing line, "If you don't mind alcohol, weapons or animal testing, you may be interested in some of these stocks."






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