Investing with Purpose: Socially Responsible Investing on the Rise

Socially Responsible Investing (SRI) is becoming an increasingly popular way of investing in companies that align with our values. As the name suggests, SRI involves investing in companies that are socially responsible and have a positive impact on society and the environment.

Investing in socially responsible companies can be beneficial both for investors and society as a whole. When you invest in these companies, you’re not only making money but also supporting causes that matter to you. This type of investing can help advance important social and environmental issues such as climate change, diversity, inclusion, and equality.

There are different ways to approach SRI, depending on your personal values and goals. Some people opt for exclusionary screening which means they exclude certain industries or types of businesses from their portfolio based on ethical or moral considerations such as tobacco or weapons manufacturing. Others choose inclusionary screening whereby they invest specifically in companies that promote sustainable practices or support social justice initiatives.

In recent years, there has been significant growth in this form of investing with many financial institutions offering SRI options to clients which include mutual funds and exchange-traded funds (ETFs). These offerings have made it easier for individuals who want to make a difference through their investments but may not have the time or resources to conduct extensive research into individual stocks themselves.

However, it’s important to note that while there are benefits associated with socially responsible investing there are also potential drawbacks including lower returns due to limited investment opportunities within specific sectors/industries. It’s crucial for individuals interested in this type of investing approach to do thorough research before committing any capital.

In conclusion, Socially Responsible Investing offers investors an opportunity not just for profit-making but also a chance to contribute towards creating positive social change. With increasing awareness about sustainability issues among consumers worldwide coupled with the rise of ESG (Environmental Social Governance) focused investments globally; it’s clear that this trend will continue growing at an exponential rate going forward.