What is ethical investing?
Ethical investing refers to the act of investing your savings, including pensions, for the betterment of society and the environment.
Being ethically selective with your investment choices takes advantage of financial markets to influence corporate behaviour and reward ethical businesses. This is done with the aim of ending harmful behaviours and tackling the challenges the world is facing.
There are several approaches to ethical investment including supplying capital and resources to companies who are providing solutions to global issues, such as renewable energy companies, and avoiding investing in those causing problems, such as oil and gas producers.
Why should I consider ethical investing?
Corporations are important influencers of societal behaviour, and these companies rely on outside investment. Ethical investing can therefore be used to help nudge companies towards better behaviours on many issues including around climate change, pollution and plastics, social and employment concerns, and excessive corporate greed.
Ethical investing can also be beneficial for long-term investment returns. Studies have shown that harmful corporate behaviours often lead to negative business consequences, including harming their growth and share price.
On the other hand, due to the positive connotations of ethical companies, such as good reputation, or attracting loyal customers and staff, ethical investments can out-perform other types of investments over the long-term. In common with all investments, ethical investing is not immune from market fluctuations; the value of investments and the income from them can fall as well as rise.
How can Prydis help with ethical investment?
We are committed to providing personalised guidance to help you make considered investment decisions that deliver on your unique ethical and financial goals. Our wealth performance management experts can advise you on how to invest in ethical investment solutions and avoid companies that contribute to worsening global problems.
We work closely with all of our clients to ensure that, prior to making any investments, there is a clearly defined investment objective and acceptable level of risk established.