While most people who invest hope to get great returns, some investors choose to buy stocks and shares based on their beliefs. Over the years, this concept has slowly gained traction and become what we know today as ethical investment.
In this article, we will look at what ethical investing looks like and the companies one can invest.
What is ethical investing?
Ethical investing refers to making investment decisions based on an individual’s social, religious, or moral values. In other words, every share, stock, and asset bought aligns with the investor’s beliefs.
As these values differ among companies and investors, each portfolio may also look different. In this regard, ethical investing is personalized, meaning there are no recognized standards that cut across all companies.
Types of Ethical Investing
As there are no set standards, ethical investing is based on four main principles.
- Religious. Those who invest based on religious beliefs look for companies sharing similar faith values. They tend to avoid companies that promote “immoral” or unethical activities.
- Environmental. Investors who base their investment on environmental principles look for companies with a positive impact on the environment by promoting eco-friendly policies or products.
- Social or political. This type of investing is focused on choosing a company based on whether their social or political morals align with the investor’s such as inclusion or gender diversity.
Ethical companies you can invest in
If you are ready to start ethical investing, here are some companies you can consider.
Salesforce (CRM)
One of the main reasons that makes Salesforce a contender as an ethical investment is its 2021 announcement that it has achieved net-zero admissions. Besides that big step, the company is also at the forefront of pushing for reforestation in economically disadvantaged communities.
ASN Biodiversity Fund
ASN Biodiversity Fund is a bank based in the Netherlands popular with many ethical investors. The bank is well-known for its eco-friendly sustainable investment options and the fund has a size of over 26 million euros.
The fund is primarily oriented towards retail investors, with a specific focus on companies that have implemented strategies to foster a positive environmental impact, specifically through agroforestry and sustainable fisheries.
Beyond Meat (BYND)
For vegan and vegetarian investors, Beyond Meat is a great option. The company that produces plant-based meat products. The company’s main aim is to enable people to shift from animal products to plant-based meat products.
Beyond Meat’s mission is to “positively affect the planet, the environment, the climate, and even ourselves” by consuming its products, which “use significantly less 93% land, 99% water, and energy” and generate fewer Greenhouse Gas Emissions (GHGE) than a beef burger.
Kimberly-Clark Corp
Kimberly-Clark has been recognized as one of the 2023 winners of the World’s Most Ethical Companies by Ethisphere. The company received this prestigious award in acknowledgment of its commitment to ethics, compliance, and the implementation of best practices in its operations.
Though it started as a paper company, Kimberly-Clark has evolved into several other brands. It is regarded as an ethical company because it has made several strides in seeking to lower carbon emissions and increase energy efficiency. Kimberly-Clark also runs various programs aimed at women’s empowerment and offering sanitation for those who need it.
Aflac (AFL)
For the 17th time this year, Aflac, a medical insurance company was once again named one of the World’s Most Ethical Companies by Ethisphere, which globally defines ethical business standards.
The Company ensures customers and suppliers are treated fairly and operates with the highest integrity vehicle conducting business. It also maintains corporate social responsibility by making charitable contributions to children living with sickle cell and cancer.
First Solar Inc
First Solar is indeed considered one of the leading companies with a strong focus on environmental, social, and governance (ESG) ethics. The core business of First Solar centers around clean and renewable solar energy, aligning with its commitment to sustainable practices and responsible corporate conduct. It has also made notable progress in the sustainable energy front by investing in the construction of grid-connected solar parks.
First Solar is committed to sustainable responsible construction practices that ensure their products have a minimal negative impact on the environment. Other than eco-friendly strides, The company is also at the forefront of promoting the health and safety of employees.
Best Buy (BBY)
Best Buy has managed to achieve zero waste in its supply chain in California, and the company was aptly recognized for the same in 2021. This achievement earned it a Total Resource Use and Efficiency (TRUE) certification.
Best Buy stands out as an appealing ethical investment choice, in part due to its ambitious environmental goals. Notably, the company aims to achieve carbon neutrality by the year 2040, with a substantial interim target of reducing its emissions by 75% by 2030. These objectives underscore Best Buy’s commitment to sustainability and environmentally responsible practices.
Conclusion
Prior to embarking on ethical investing, it’s essential to define your values, assess your financial resources, and understand that ethical investment is a multifaceted endeavor. It involves various considerations beyond the surface, making thorough research crucial. If you find yourself unsure about how to begin, it may be beneficial to seek the guidance of a broker, investment adviser, or financial planner who can provide valuable insights and expertise in aligning your investments with your ethical principles.
Disclaimer: Investing can be quite a wild ride – especially when you don’t know the terrain! To keep things from getting too rocky, take some time beforehand to get familiar with all of the risks involved. Our site is here to up your investor game by providing all available intel about platforms and trends, but we don’t take responsibility nor can we be held accountable as advisors. That being said, it’s still important for you to make educated decisions that match what works best for YOU – just remember: no amount of savvy will guarantee success or protect against loss so invest money you can spare.
