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Why Now is a Great Time for Socially Responsible Investing

Socially responsible investing (SRI), the concept of investing in companies and products that make a positive societal impact, has been around for many decades. This type of investing has taken on different forms and names over the years, but the main concept of earning a solid return while doing good at the same time is as strong as ever. In fact, one out of every five dollars that is invested under professional management in the United States is invested using socially responsible screening, according to the US SIF Foundation.

And now, with the Presidency of Donald Trump, socially responsible investing is more important than ever. Take the environment for example. Curbing negative environmental influences have not been addressed on a governmental level in the Trump administration. The nation’s top environmental official, the EPA’s Scott Pruitt, strongly rejects the established science of climate change. And other cabinet members, including Secretary of Energy Rick Perry, have previously questioned the scientific basis for combating global warming.

What this means is that we certainly can’t count on the government to help in making important, beneficial societal impacts through legislation. To help encourage and implement these vital changes, we simply can’t look to Washington. Instead, the onus is on us, the investor. And this is where socially responsible investing comes into play, and why now is such an important time to consider this investment strategy.

If we desire to make a difference in our communities and in the world as a whole, we have lots of opportunities to help support these causes, from volunteering to donating money, for example. Investing in companies that promote positive societal benefits is another great way to show your support. Whether it’s through companies that promote environmental stewardship, human rights, diversity or consumer protection, there isn’t a better time to invest in these companies given the current administration’s apathy towards making profound, positive social change.

And it’s easier than ever too. The number of companies and investment products that are socially conscious continues to rise. Over the past five years alone, 45 new SRI mutual funds have opened. There are now 181 SRI mutual funds and 39 exchange-traded funds in the U.S. So there’s a multitude of investment options to choose from.

In sum, the time is ripe to make a difference through your investing. Continue to volunteer and donate to your favorite charities and causes. But also consider investing at least some or all of your portfolio in companies and funds that are important to you. You’ll be glad you did.

Tom Neff
Tom is the Managing Partner of RINA Accountancy, LLP.
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