SRI funds: the altruistic way to invest

Do you have a hard time reconciling your need to have a diverse investment portfolio with a desire to support socially responsible companies? If so, it may be a good idea to look into socially responsible investment (SRI) funds.

What are SRI funds?
An SRI fund is one that’s built upon strategically considering both financial return and social responsibility. Initially, it was thought that SRIs wouldn’t perform as strongly as traditional investments. How¬ever, this isn’t the case. It turns out that they’re just as likely to perform strongly as other types of investments.

How are investments selected?
Investments are chosen using screens for environmental, social and corporate governance. Both positive and negative screens are used in the selection of SRIs.

Corporate practices that promote environmentalism, human rights and consumer protection are sought after. Conversely, businesses that are perceived to have a negative impact on society such as those involving alcohol, tobacco, weapons and fossil fuel production, are avoided.

However, as there are no regulations governing what can and can’t be included in SRIs, they may vary greatly from one to the other.

If you’d like to learn about how you can add SRI funds to your retirement portfolio, speak to your financial adviser to find out more.