Ethical Investing

kittieviolet · 8 July 2018 at 1:21PM

Hi I am a total newbie to investing so please be kind. I wondered if anybody had any experience with ethical investing. Passive investing would be my choice. I have been looking at some ethically labelled funds but I am having difficulty choosing as I have never heard of some of the companies. Also my idea of ethical would be: sustainability, renewable energy companies and those with with no animal testing.
I would be grateful for any pointers or anyone with experience in this area.
Thanks in advance

dunstonh · 8 July 2018 at 1:49PM

Passive investing would be my choice.

Whilst possible, the options are limited and not really in keeping with ethical investing. The reason for that is that everyone has their own ethical stance. So, all ethical funds are set on a criteria that means they exclude certain things. Or must include certain things or are indifferent.

Finding a passive that matches your particular ethical profile will be luck rather than expectation.

Also my idea of ethical would be: sustainability, renewable energy companies and those with with no animal testing.

Are those must-haves or nice to have? So, no problems with tobacco then?

Look at an ethical profile list and then complete it deciding your stance. Then filter the funds based on that criteria.

Filo25 · 8 July 2018 at 2:14PM

dunstonh wrote: »

Whilst possible, the options are limited and not really in keeping with ethical investing. The reason for that is that everyone has their own ethical stance. So, all ethical funds are set on a criteria that means they exclude certain things. Or must include certain things or are indifferent.

Finding a passive that matches your particular ethical profile will be luck rather than expectation.

Are those must-haves or nice to have? So, no problems with tobacco then?

Look at an ethical profile list and then complete it deciding your stance. Then filter the funds based on that criteria.

That is the main issue with ethical investment, as you say, many people have different ideas of investments which should be included or excluded from such a fund.

My wife for instance would prefer not to invest in tobacco companies or fossil fuels, as that is only quite a narrow list of exclusions some concentrated mainstream funds which aren't even listed as ethical would basically be fine.

firestone · 8 July 2018 at 2:39PM

would agree with others that one persons idea of ethical may not be others as i did see somebody complain on another forum last year that their sustainable fund had a Amazon holding and they did not agree as they did not like some of the books,films and other products they carried!
Having said that if you search i.e ethical or esg investing you should get some ideas i know the Royal London sustainable range that they took over from the Co-Op get good reviews so others may have some views if holding.I have had good results with Impax Environmental Markets IT which may fit with your renewables/water/waste etc and there is also Greencoat UK Wind IT but they are all managed funds

kittieviolet · 8 July 2018 at 4:01PM

Thank you so much for your replies. You have echoed what I was finding. Products were being labelled as ethical but on searching further the were not as substantial as I would have liked. I guess its up to personal opinion what is acceptable. I also wouldn't want to invest in tobacco or armaments.
Thanks again for taking the time to reply and the suggestions, I will look further in to Royal London, Impax and Greencoat

TBC15 · 8 July 2018 at 5:41PM

Fundsmith went ethical recently I believe. Must admit I had the same feelings when Dillon went acoustic. But the man has a nose for money.

grey_gym_sock · 8 July 2018 at 6:25PM

fundsmith launched a "sustainable" fund, though i think it's only available to institutional investors. there's no change in the investment policy of his existing funds.

it's worth noting the difference between ethical/sustainable funds which are going for a broadly diversified portfolio, and more niche/specialist funds.

the former might be suitable to put a large part of your portfolio in, providing their idea of what's ethical is close enough to your own and that you think they're competent as investors. (the royal london sustainable range are probably in this category.)

the more niche funds would only be suitable for a small percentage of a portfolio. e.g. greencoat would be in this category, wind energy being a pretty narrow sector.

bostonerimus · 8 July 2018 at 7:49PM

I gave up on "ethical Investing" a long time ago as I figured capitalism and ethics are not well correlated. So I try to be ethical in my daily life and do good things for the planet and people; I ride my bike rather than drive my car as often as I can, I keep my heating low in the winter, I give to local and national charities and I vote for politicians that I think will improve things.

Terry_Towelling · 8 July 2018 at 8:07PM

bostonerimus wrote: »

I gave up on "ethical Investing" a long time ago as I figured capitalism and ethics are not well correlated. So I try to be ethical in my daily life and do good things for the planet and people; I ride my bike rather than drive my car as often as I can, I keep my heating low in the winter, I give to local and national charities and I vote for politicians that I think will improve things.

Good man! (or woman). Have you come across some interesting research that says we should drive more and cycle/walk less? Apparently, more vigorous physical activity produces more CO2 (exhaled breath) per mile than a modern car does. All these cyclists/runners/athletes are just spoiling the planet for us innocent motorists!:)

AnotherJoe · 8 July 2018 at 8:53PM

Terry_Towelling wrote: »

Good man! (or woman). Have you come across some interesting research that says we should drive more and cycle/walk less? Apparently, more vigorous physical activity produces more CO2 (exhaled breath) per mile than a modern car does. All these cyclists/runners/athletes are just spoiling the planet for us innocent motorists!:)

That would seem to be a misleading statistic (as are 72% of all statistics

)

The CO2 exhaled by a person would be generally carbon neutral since it's recycled carbon ultimately derived from the atmosphere* whereas that froma car would overall add to the CO2 in the atmosphere as you are releasing carbon that was previously locked up in an oil,deposit.

Plus, when a fossil fuelled car drives past you it's also emitting toxic fumes which are more of an immediate danger, that a runner or cyclist won't (unless they've been eating a lot of cabbage or beans)

* there will be a contribution from the fossil,fuels used to grow and transport the food. Good luck working out what's what.

Terry_Towelling · 8 July 2018 at 9:04PM

AnotherJoe wrote: »

That would seem to be a misleading statistic (as are 72% of all statistics )

The CO2 exhaled by a person would be generally carbon neutral since it's recycled carbon ultimately derived from the atmosphere* whereas that froma car would overall add to the CO2 in the atmosphere as you are releasing carbon that was previously locked up in an oil,deposit.

Plus, when a fossil fuelled car drives past you it's also emitting toxic fumes which are more of an immediate danger, that a runner or cyclist won't (unless they've been eating a lot of cabbage or beans)

* there will be a contribution from the fossil,fuels used to grow and transport the food. Good luck working out what's what.

You are completely 100% wrong. It is way more than 72% of stats that are misleading.

I give no credence to the research that made the suggestions but it seems we need to stop eating carbon-based food, driving, breathing, reproducing, farting whilst running - and - cycling!

Ethical Investing

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