If you could invest in companies that pay their employees fairly and provide them with benefits like stock or profit sharing, would you? Or maybe you’d prefer to invest your money in environmentally friendly and sustainable businesses.
If this sounds up your alley, you might want to check out the world of ethical investing.
Ethical investing is a broad term for any type of investment that meets specific standards about social or environmental impact. With an ethical portfolio, you can make a positive difference while growing your assets simultaneously.
Read on to learn more about how ethical investing works and why it’s such an excellent idea for your future.
What Is Ethical Investing?
Ethical investing is any investment that meets specific social or environmental standards. This approach can be applied to many kinds of assets, including stocks, real estate, or any type of lending.
There are many different standards that guide ethical investing, but investors can generally choose between three types of ethical investing: Socially Responsible Investing (SRI), Ethical Investing, and Impact Investing.
SRI is a catch-all term that includes any investment that considers social impact but may not consider environmental impact at all. Ethical investing is a stricter standard focusing on sustainability, transparency, and fairness. Impact investing includes SRI and is focused on solving major social or environmental problems with creative financing.
How To Go About Ethical Investing
Find the Right Company to Invest In
Finding a company to support your investment doesn’t have to be long and tedious.
The first step is to decide what sort of standard you want to invest by. Start by asking yourself some questions. What are the biggest problems in the world today? What industries do you feel strongly about? What do you want to accomplish with your investment?
Once you’ve narrowed your focus, you can start researching companies that meet your ethical standards.
Know Which Industries Are In Line With Your Values
Before building an ethical portfolio, you need to know what industries you are happy to support and those you are not. You’ll find that some sectors are ethically acceptable but make products or provide services that you don’t want to be a part of.
Add Instruments That Help Achieve Your Ethical Investment Goals
Another essential step in building an ethical portfolio is to leverage tools that help achieve your ethical investment goals. For example, you can add a non-profit trust that supports your ethical investing goals to your portfolio. You can also add ETFs designed to support your ethical investing goals.
Ethical investing is a great way to make an impact with your money. It’s also a great way to grow your assets, thanks to the wider lens that considers the company’s health in addition to its profit.
Consider the information above if you want to start your ethical investing journey today.