As Resonate re-branded itself is 2015, we found these things to be of primary importance to us:

“Encouraging our clients to clearly define what is most important to them about life and money” and then “Aligning our clients’ money with their life and purpose to express social, political and environmental values which lead to creating meaningful outcomes.”

This has led us to consider the following in offering investment choices to our clients:

  • “Investing in businesses which pass certain ethical practice screens;
  • “Considering social, political or environmental impact as important in investment decisions;
  • “Providing values’ based investing.”

What does it mean to invest in businesses that pass certain ethical practice screens?

Screening is the process of selecting companies to invest in based on their social and/or environmental performance.   As you will read below, many “shades of gray” can exist in the screening process.

The process of screening can be easily broken down into two very different methods, negative and positive screening. Negative (or avoidance) screening refers to excluding companies that manufacture certain products that are objectionable, such as heavy polluters, animal testing, or tobacco products.

Positive (or affirmative) screening is more proactive, selecting companies that show leadership in product design, employee policies, environmental protection, human rights or other practices.

Although positive and negative screening are easily distinguished, they are best considered as complementary tactics that can effectively be used to select socially responsible companies. (Source: SocialFunds.com Learning Center)

A best-in-class approach to screening applies social, environmental and ethical guidelines to give a preferred selection when all other factors are equal.   For example, an ethical fund might have criteria which enable it to invest in the oil and gas sector, but only in those oil companies which are ‘best in their class’ as they have a better record on the environment and human rights than others in their sector.

(Source: ERIS: Green and Ethical Funds.)

Considering social, political or environmental impact…

This tenet of socially responsible investing may include Shareholder Activism.   This is another growing tactic used by institutional investors, including initiating dialogue with companies concerning their record or filing shareholder resolutions pertaining to some aspect of corporate social responsibility.   Shareholder advocacy efforts of socially responsible investors have greatly increased the awareness of many important issues and resulted in significant changes at some companies.

If you are interested in “investing aligned with your values and core life beliefs”, let’s talk!

Barbara A. Culver
CFP®, ChFC®, CLU, AEP®
Resonate, Inc.

(513) 605-2500