7Newswire
30 Dec 2022, 14:15 GMT+10
Ethical investing is an investment approach that focuses on the environmental and social impact of the companies investors choose to invest in. It involves deciding where to put your money based on values and beliefs rather than just focusing on financial returns. In short, it's about aligning your investments with what you view as important. In this post, you will learn about ethical investing and why it's so important.
The concept of ethical investing has been around for some time, but in recent years it has gained more traction among investors. There are a few different approaches you can take when it comes to ethical investing. First, "negative screening" approaches involve avoiding investments in companies or industries that may be deemed unethical or socially irresponsible (e.g., tobacco, weapons manufacturing).
The second approach is called "positive screening." The approach carefully evaluates a company's financial performance, considering sustainability measures, workplace conditions, environmental policies, and charitable activities. This review allows investors to select companies that align with their values while still being financially strong. Additionally, investing in companies mindful of reducing their carbon emissions, creating healthier workplaces, and contributing to society can reap long-term rewards by bolstering the market's overall sustainability.
It's important to note that ethical investing isn't necessarily synonymous with sustainable investing-although they are related concepts. For example, sustainable investing typically considers a company's overall environmental impact, whereas ethical investing focuses more on how the company behaves ethically toward its stakeholders (employees, customers, suppliers, etc.). Therefore, sustainable investments may not necessarily be considered "ethical" if the company's behavior isn't up to par with specific standards of conduct.
In addition to making decisions reflecting on their beliefs and values, many investors also look at external ratings from trustworthy organizations when selecting investments for their portfolio. These ratings objectively assess whether a particular company meets specific criteria for ethical investments-such as labor rights practices or corporate governance-and can help investors make informed decisions about where to invest their money.
Investing ethically does not mean you have to lower your financial goals. Far from it. Savvy investors realize that investing in environmentally responsible companies can still make money while exercising an ethical conscience. In addition, studies have shown that the stocks of companies with ethical values often outperform those without them, resulting in higher investment returns.
Additionally, because these types of investments are often long-term strategies, you do not have to worry about market fluctuations weakening the value of your investment portfolio. Whether you believe in their production methods or not, investing ethically can be a viable-and profitable-investment decision for individuals and corporations alike.
Ethical investing is a fantastic opportunity for investors to ensure their money goes into companies and industries they believe in and support. By considering factors such as environmental impact and corporate governance practices when selecting investments for their portfolio, investors can ensure they put their money towards causes they care about while aiming for financial returns. So whether you're looking to avoid specific industries or invest in ones with positive social impacts, ethical investing is one way to ensure your money is being used responsibly and sustainably.
Get a daily dose of London Mercury news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to London Mercury.
More InformationShe tells a court everything seemed normal in the hours before the baby was killed. ...
Alice Stones died when she was attacked by the family pet in a garden in Milton Keynes last week. ...
Paul King, 63, is jailed for eight years for attacking a 16-year-old boy in a park in Stevenage. ...
Ukraine's president gave the speaker of the House of Commons a helmet, as he visited Parliament to address politicians. ...
There are fears the 30 weekly allowance is not enough amid the cost of living crisis. ...
Former Metropolitan Police officer David Carrick has been jailed for a minimum of 30 years. ...
TORRANCE, California: Due to un-repaired Takata air bag inflators that can explode and unleash potentially deadly metal shrapnel inside vehicles, ...
NEW YORK, New York - After a day of major gains, U.S. stock markets fell sharply Wednesday underscoring volatility as ...
CAPE CANAVERAL, Florida: In a tweet this weekend, Elon Musk said that SpaceX may attempt a Starship rocket system launch ...
LONDON, England: The Society of Motor Manufacturers and Traders has reported that new car registrations in the UK rose for ...
TAIPEI, Taiwan: After the end of COVID-19 disruptions in China, Taiwan's Foxconn, the world's largest contract electronics maker and major ...
NEW YORK, New York - Stocks ended sharply higher on Tuesday following mixed comments by Federal Reserve Chairman Jerome Powell.Powell ...