Mutual Funds and Socially Responsible Investing
Mutual funds are meant purely to generate revenues for the investors. The goal of mutual funds is to maximize the amount of money that each investor earns. But investing is often a daunting task for environmentalists. Many industries are notorious about trashing the environment for profit, and most environmentalists don‘t want to support companies that routinely damage the world. Therefore now a day, while investing money, a number of investors demand greater accountability with respect to where their money is being invested, and for what purposes, so as to align their investments with moral and social values. More and more investors are looking to invest their money in Eco-friendly companies that are supporting the planet by the work they engage in.
Socially Responsible Investing (SRI), also known as sustainable investing or ethical investing, describes an investment strategy, which seeks to maximize both financial return and social good. It is an investment strategy, which considers the social and environmental consequences of where your investment money goes. Socially responsible investors include individuals and also institutions, such as corporations, universities, hospitals, foundations, insurance companies, public and private pension funds, nonprofit organizations, and religious institutions.
SRI is the practice of making investment decisions on the basis of not only financial performance, but also on ethical, social, and environmental criteria. It recognizes that corporate responsibility and societal concerns are valid parts of investment decisions. Socially responsible investors favor corporate practices, which are environmentally responsible, support workplace diversity, and increase product safety and quality.
Socially responsible funds choose stocks of companies after carefully screening to qualify them for investment. These are Mutual Funds that invest the assets under their management in stocks of companies that practice ethical practices. They choose to go green with their investment choices and that can help to bring about positive social and environmental changes