Conflict and Pollution; Just Where are you Investing?

Melting polar ice caps, reports of war and fighting, unrest with Russia and concerns about our reliance on other countries for fuel, these are all stories to reach newspaper headlines in recent weeks.

We have all probably passed comment on the issues, shared an opinion over coffee at work or mentioned it in the pub. This is why it can come as a real shock to some people when they lift the lid on their investments and pensions, only to discover that their money is supporting the very industries that they disapprove of.

For some people it isn’t enough just to invest for returns; some people want their savings to do good too. This means making a carefully considered decision to invest some or all of their money into businesses which sits comfortably alongside their beliefs. This means ensuring that their money does not support businesses which are involved in sectors such as gambling, arms trade or the sex industry.

It shouldn’t also be assumed that funds invested for a child, such as a Child Trust Fund or a Junior ISA, are automatically entered into a funnelled fund choice with a socially responsible conscious either. Children's investments are just as likely to be invested as widely as your own.

There are three main categories of socially responsible investing;

1. Ethical funds, which have rules about the type of industries that can’t be

invested in

2. Funds for climate change and the environment

3. Funds which focus on investing in sustainability

You can choose to invest specifically in one of those areas, or you can choose a Socially Responsible fund which considers them all. Ethical or Socially Responsible funds are often differentiated by their shade of green. The darker the shade of green, the more restrictive the rules surrounding the fund as to what can and can’t be invested in.

Of course taking a socially responsible investing approach is not at the top of everyone’s list of priorities, which is why there is so much choice available, however it is important to know what is happening to your money so you can make an informed choice.

At Sanlam, our Accel Socially Responsible Investment (SRI) models invest mostly in funds with a bias towards ethical investing, environmental concerns, corporate social responsibility or related themes.

They are designed for those who are looking to combine their personal ethical values and social concerns with active portfolio management. The aim is to provide capital growth in line with our client’s individual attitude to risk.

Sanlam’s Socially Responsible Investment models suit the needs of a wide range of clients and are intended to be generalist portfolios with no specific theme of their own, nor any avoidance criteria. This means that they fall into the category of being a ‘light green’ fund, so people with very specific or detailed ethical criteria may not find them suitable.

It is very easy to invest in a socially responsible way if this is something that is important to you. It simply means having a conversation with your financial adviser about the funds you currently invest into and considering the alternatives available to you.

Email letstalk@sanlam.co.uk if you would like to speak to a financial planner to find out more.      

The above article is for information purposes and should not be treated as advice. Individual circumstances should always be considered prior to purchasing any financial products. For further information contact Sanlam Private Wealth by e-mailing letstalk@sanlam.co.uk. Sanlam Private Wealth is a trading name of Sanlam Private Wealth UK Limited. Authorised and regulated by the Financial Conduct Authority.