Ethical and Social Investment
Follow the trail
- Basic issues;
- Sources of information;
- Investment funds;
- Credit unions.
- Environmental and Social Impact of voluntary organisations.
- Social Economy resource page including social enterprise and community businesses.
- Sustainable Business/Corporate Governance listings under Areas of Concern.
- Personal ethical action: see Taking Action Personally.
- Banking Services for voluntary organisations.
A growing activity of increasing interest to voluntary groups. Charities often feel constrained to pursue ethical investment (which here is taken to mean banking, pension schemes as well as trading in stocks and shares) by believing they have to maximise financial returns.
Firstly, ethical investments have had a good track record to date, where properly managed, although there are investment funds which specifically dont try to achieve high financial results.
Secondly, it is legitimate to take other issues into account, such
- investing in companies where the charity's objectives oppose its activities is clearly counter-productive to achieving those objectives.
- where investing in a company is likely to lose members, donations or public support, that too may not be in the best interests of the charity.
- some positive investments may be of help in achieving charity objectives, and slightly lower financial performance may therefore be justified.
Sources of information
These are gradually increasing in web presence.
EIRIS Ethical Investment Research Service, 80-84 Bondway, London, SW8 1SF, phone 020 7840 5700, email firstname.lastname@example.org. Ethical Portfolio Manager is a CD-ROM based 'research tool' for analysing social and environmental performance of companies (and can be updated via the web access) - launched May 00. There is also a bi-monthly newsletter The Ethical Investor. Set up in 1983, the fullest range of services, including screening, checklists and guidance on approaches, enabling investors to create a portfolio reflecting own ethical concerns, etc.
EIRIS with UKSIF have set up CharitySRI web site, to provide "clear comprehensive guidance on how charities can invest ethically" and align their investments with their mission (aka socially responsible investment).
Ethical Investments - How far may charity trustees go? £2, Ethical Investment - have the Church Commissioners got it right? 50p, both from Christian Ethical Investment Group. Miss P Raikes, CEIG Enquiries, 2a New High Street, Headington, Oxford, OX3 7AQ (Info may be out-of-date).
Ethical Investment Association (EIA) is a nationwide body of independent financial advisers (IFAs), which aims to facilitate the promotion of ethical investment by its members, and to set standards in the ethical investment industry.
National Ethical Investment Week has some information.
UK Social Investment Forum A grouping of financial advisors, fund managers, investors and others, which has the primary purpose 'to promote and encourage the development and positive impact of Socially Responsible Investment throughout the UK'. Useful listings of members and affiliates, plus articles, newsletter items.
Investment Funds, Banks, Investment Vehicles
- CAF (Charities
Aid Foundation) has a variety of investment vehicles for charities,
including socially responsible portfolios,
plus ethical investment information.
- The Ethical Partnership
- independent financial advisers.
- Ethical Property Company
Invests in premises to let out to charities, community groups, social
enterprises. Resource centres in London and elsewhere.
- Co-operative and Community Finance Promote and carry out investment
in the 'social economy'. Head office: 01179 166750.
- Shared Interest 'Our
funds come from our members, thousands of ordinary people who have
pooled their savings to provide the finance that Third World Producers
- Social Investment Business.
- Triodos Bank 'One of Europe's
leading ethical banks, draw on 20 years experience financing social
and environmental charities.' Brunel House, 11 The Promenade, Clifton,
Bristol, BS8 3NN, phone 0800 328 2181 or 0117 973 9339, email: email@example.com
- Community Investment Trusts, or Community Development Finance Institutions,
have sprung up around the country. (There are tax breaks for these.)
Development Finance Association.
- Some local or regional trusts: Ulster
Community Investment Trust. Impetus - Shropshire, Herefordshire,
- Pension providers are on our Pay and Benefits page.
Credit Unions are mutual financial (and democractic) organisations, particularly promoted by community, coop and tradue union movements. Members are individuals, rather than organisations, but are part of the 'social investment scene'.
- Association of British Credit Unions.
Holyoake House, Hanover Street, Manchester, M60 0AS, phone 0161 832
3694, email: firstname.lastname@example.org
- SCVO is developing its own
credit union for those involved with its member bodies. Phone 0131
556 3882, email: email@example.com
- Unity Trust Bank offers a Credit Union Development Fund which helps fund a credit union grant programme as well as paying high interest.