Socially Responsible Investing (SRI)

Socially responsible investing is the integration of environmental, governance and social criteria into the traditional investment decision making process. Whether large institutions or individuals, social investors believe in using economic and market levers to encourage corporate responsibility and positive social change. Social investment allows large institutions and individuals alike to make investments that are consistent with both their social and financial goals.

Socially responsible investing (SRI) spans a wide and growing range of products and investments, from stocks and bonds, to venture capital. Like all investors, socially responsible investors seek a competitive financial return on their investments, and the good news is that it is possible to consistently achieve this.

Socially responsible investing (SRI Investment) is an investment approach where investors choose companies and projects based on how they conduct business, weighing both their commitment to corporate and social concerns. Commonly, socially responsible investors avoid investing in industries with harmful or negative effects like oil, tobacco, gambling or weapons manufacturing. Environmentally friendly and socially progressive companies tend to be more popular socially responsible investments, like corporations that promote natural energy, or small businesses that aim to develop surrounding communities. In other words, socially responsible investing is reasonably consistent with the investor’s values.

By making socially responsible investments, investors are also advancing a company’s bottom line, and in turn, generate long-term profits for themselves and other shareholders. Research has found that SRI funds over a ten-year span have outperformed those on the stock market. Since socially responsible investments are made with long-term goals in mind, they provide much more stable returns than traditional stocks.

In the last decade, socially responsible investing has caught the attention of an increasing number of corporate investors, who are seeing the value of incorporating environmental and socially responsible practices in their businesses, and taking into consideration environmental risks and climate change when producing and distributing products. Institutions—like universities, hospitals and even insurance companies— have become the largest and fastest-growing segment of investors playing on the SRI field.

To find out more about socially responsible investing, Emerald Knight has a list of carefully chosen SRI opportunities to fit your social, environmental and investment criteria.