Monday, October 22, 2007

Do Socially Responsible Investors Dam Patagonia Rivers?

Just how responsible is your 'socially responsible' fund?

[October 22, 2007] 'Ethical investors' may be surprised to discover where their money is ending up, and just how little difference there is between SRIs and regular mutual funds.

Socially responsible investing is touted as being for people who care about the world they live in, and want to preserve it for generations to come.

British Columbia-based Ethical Funds Company asks investors on its website: How do you want your investments to change the world? Possible answers are "cleaner air," "peace" and "take better care of the planet."

So what are socially responsible funds doing investing in HudBay Minerals Inc., which the National Pollutant Release Inventory for 2006 ranked as the worst polluter in Canada based on total emissions? Or in oilsands, the most environmentally damaging method of extracting oil there is, according to the Pembina Institute.

Before plunking down their hard-earned cash on something that sounds good, and that advertising says will change the world, investors may want to take some time to research which fund, if any, meets the socially responsible needs of their conscience. And that could mean hours of navigating through websites, and reading official documents. Because for investors to be sure they really can sleep at night, they have to go beyond the words "socially responsible investing" and read the fine print.

Here is the full article.