Ethical Investment Week Starts Today

This week the Ethical Financial Advisers Co-Op is celebrating ethical investment week, which hopes to encourage both investors and financial advisers to think about their own practice of ethical investing.

You can start by listening to this 13 minute podcast about Wayfinding for ethical investing. Host Alexandra Brown says that “an ethical investor’s purpose is to make money, and make a difference.”

If you’re looking to better understand the philosophical underpinnings of ethical investing then don’t miss tomorrow’s seminar by Professor Chellie Spiller and Dr Rodger Spiller arguing that “in ethical investment, Performance Measurement goes well beyond conventional financial measures, to also report on ‘impact’. “

You can register for this seminar on ethical investing right here.

Personally, I’m taking the opportunity to take a look at my own ethical investing.

Personally, my approach is to invest principally in technology companies and healthcare companies.

Generally speaking, when a company makes a profit by making someone live for longer, they provide great value for money, since time is the most valuable thing in the world.

Equally, the vast majority of software and hardware technology is designed to make people safer or to save them time.

If you apply my framework about the impact these companies have on the world, you can see why I invest in Alphabet (Google) shares but not Facebook shares.

Google saves us a huge amount of time, and gives us the answer to almost every question. It democratises knowledge by giving anyone the same kind of access to information that was once reserved for the precious few.

Facebook, on the other hand, is a hive of misinformation that (among other things) causes people not to get vaccinated, and to die as a result. Studies show that instagram makes its users unhappier, and more likely to develop mental illness.

For this reason, I see Google as more ethical than Facebook.

Closer to home on the ASX, one interesting ethical business is called MedAdvisor (ASX:MDR). I do not own shares in it but I like the fact that the founder originally came up with the medication management app to help his own mother manage her chronic illness. These days, it makes significant global revenues helping improve adherence to medication prescriptions, through a combination of patient outreach and also just by making it easier for patients to fill their scripts on time, with less hassle. You can check out the MedAdvisor app for yourself.

If you’d like to learn more about the company check out this video of Australian Ethical portfolio manager Andy Gracey talking about MedAdvisor, alongside two other ethical investments, Gentrack (ASX:GTK) and Cogstate (ASX:CGS)

It’s easy to see how that company’s success could lead to a happier healthier society. It can save people time by improving their health and allowing them to get their medication more easily!

For me, ethical investing is about analysing the incentives in business models, more than an ESG checklist.

What is Ethical Investment?

Personally, I define ethical investment as any investing that considers the impact on the environment and other stakeholders, as well as financial returns.

In any event, I hope that readers will take ethical investment week as an opportunity to talk about ethical investing, and perhaps explain why it does not need to mean lower returns.

Certainly, investing mostly in tech and healthcare has been kind to me.

If you’re looking for an ethical financial advisor, you can find a list of ethical financial advisors right here.

And I have written this article about 3 Green Stocks Investors Are Watching.

Please remember that these are personal reflections. I own Alphabet shares and these thoughts are incomplete. This article must not form the basis of an investment decision. It is an investment diary valuable only for the cognitive process it demonstrates. We do not provide financial advice, and any commentary is general in nature. Please read our disclaimer.