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Tuesday September 26th 2017

Socially responsible investments and sustainability

This is the best time for you to think beyond profitable stocks and return on your investments. We cannot simply invest in companies that do not care about our society or environment, even if they promise good returns. Religion is one of the motivational factors for ethical investing; many investors follow their religious belief in investing and avoid addictive substance such as tobacco, drugs and alcohol since it is not encouraged in some religion. The use of arms and ammunition also condemned in some religions since it is any way harmful to our society.

By not investing in the companies that do business in gambling, weapons, drugs and alcohol products, investors sends a clear note to them saying that “they do not encourage such companies/products”. This moral and ethical investment behavior is a welcome sign for the stock market and promotes long term social and environmental well being.

Selecting companies that provide significant contribution to society, such as free education, medical care and child welfare for your investments encourages such initiatives taken by the corporates and promotes better social environment. Socially responsible investments’ in the recent years has shifted the profit-centric approaches of the business establishments to be responsible social-friendly organizations.



The fund managers of major investment agencies adopt different statistical methods and analysis to identify socially responsible stocks in the market. They grade the stocks based on the corporate ethics, values and social service activities. Fund managers also analyze the sustainability indices of companies and rank them based on their carbon emissions.

Increased environmental awareness and global warming impacts influenced the investors to actively select the green / clean investment options. The world we face today is full of pollution and rapidly becoming environmentally unsafe place to live. Socially responsible investing encourages sustainability and social development. Selecting your stocks based on social and moral principles directly benefits our society and improves green environment.

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