Ethical Investment Week 2021
Today marks the beginning of Ethical Investment Week.
Now in its eighth year, Ethical Investment Week highlights the importance of ethical investing and the benefits it can offer investors.
But what is ethical investing?
Ethical Investing is a holistic approach to investing, which considers not only financial returns, but the impact of that investment (both negative and positive) in areas of social justice, corporate governance and the environment.
It helps investors to invest according to their ethics and values; and holds companies accountable for their social and environmental impact.
Investment managers use a range of criteria to identify companies that align with their standards and values. They look at things like sustainable agriculture, renewable energy, employment equality and community investment to name a few.
Negatively screened sectors or activities, such as gambling, tobacco, production of weapons and animal testing, are excluded all together. Although some of these companies are doing nothing illegal, it could be considered morally wrong to profit from them.
Do you ever think about how ethical your bank accounts, loans, superannuation funds or other investments are?
According to the Responsible Investment Association Australasia, 86% of Australians expect their superannuation to be ethically invested. But is it?
Do you know who you are investing with and what these companies do to make their money? If so, are you happy with this?
There are different types of ethical investing and there is no one-size-fits-all approach. As with all aspects of investing, it is about being comfortable with your investments.
Consider your own ethical stance. If you’re concerned about your money supporting industries you don’t agree with (or, on the flip side, want to actively invest in industries/companies you believe are making a positive difference to the world) ethical investing may be the solution.
At 123 Financial Planning, we recognise that everyone is different. For clients who view ethical investing as a priority, we apply an ethical investment overlay to our advice. Because in addition to growing wealth, it is important to us that we match our clients with investments that are in line with their personal ethics and values.
We are members of the Responsible Investment Association Australasia (RIAA) and the Association of Financial Advisers (AFA).
If you are interested in finding out more about ethical investing, contact us on (02) 4920 7886.
Ethical Investment Week runs from October 25 to 29. For more info head to: https://www.ethicaladviserscoop.org/ethical-investment-week.html
Authorised Representative No.1255457 of Interprac Financial Planning Pty Ltd (Afsl 246638)