Why Choose Ethical Investing?

From the millionaires to anyone with a super fund, Ethical Investments Week aims to get people thinking about the dollars to their name and what they want to put those dollars towards. “We are transforming the finance system, and financing the transformation needed for a sustainable future,” says the Co-Op, which has approximately $2 billion in funds under management.

This year, EAC is launching “leaf ratings,” which evaluates the ethical standards of funds; access leaf ratings for free here. Investors can also seek out personalised advice here.

There also are a number of online events being run for Ethical Investment Week, including podcasts on the philosophy and practice and ethical investing. You can find more infoormation here

The ethical investment movement has seen a major expansion in the ethical funds available to investors over recent years. In the US, $12 trillion out of a total $46 trillion in professionally managed assets is now managed according to some sort of ‘ethical’ criteria.

A recent high-profile victory for the ethical investment movement came in the aftermath of Rio Tinto blasting Juukan Gorge. After the annual shareholders’ meeting, the company was forced to ‘apologise unreservedly’ and saw its chairman resign. This in turn lifted the bar for governance of mining companies, with processes changing at Woodside, Santos, AGL, BHP, Origin and Fortescue. 

This has not been at the expense of returns for ethical investors. In fact, Morningstar found in 2020 that “a majority of sustainable funds have out-performed their traditional peers.” 

Sustainable funds also tend to be longer-lasting. That is to say, they are not wound down due to poor returns as often as traditional funds. 

And it stands to reason. Advisors who care about the ethics of their investments are more likely to be ethical towards those they advise too.

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