Socially responsible investing (SRI) can enable investors to maintain balanced, diversified investment portfolios while putting their money to work to build a better future. Green investing, impact investing, ESG—SRI is also known by these other related names, some of which may have slight differences in definition. Yet, they all are essentially the practice of utilizing capital to shape corporate behavior that promotes the public good.
Social investing incorporates three key strategies:
Through these three strategies, SRI can be a powerful force for global change. By combining our assets as shareholders, we can exert influence over company and industry policies and behavior to promote positive economic, social and environmental change. Moreover, our clients can direct capital toward underserved communities in need of funding for housing, health care and economic development.
Many investors believe that socially-screened investments are "outperformed" by non-screened portfolios. This belief is unwarranted based on two points.
In sum, we believe that corporations that combine positive financial and social performance really do make the best long-term investment.
Investing involves risk. Depending on the different types of investments there may be varying degrees of risk. Socially responsible investing does not guarantee any amount of success. Clients and prospective clients should be prepared to bear investment loss including loss of original principal.