Times change and so does the thinking. It’s more a case of evolving minds. When people speak about investments they mean some out and out profit generating idea. However, now the masses are rising to the fact that they do indeed bear a social responsibility. Each one of us has to contribute towards making things better. We cannot always rely on someone else doing the needful. Proactive action is the call of the day. Social Responsible Investing is one way to ensure, we give back to the society that we are a part of.
Understanding Social Responsible Investing
Commonly known as SRI or sustainable investing, it is the act of investing in the socially beneficial funds and stocks. In simple terms, it is a discipline that forces you to consider your social and environmental responsibility while investing your hard earned money. Therefore, choosing an investment on the basis of Environmental, Social, and Corporate Governance or ESG is called Social Responsible Investment.
SRI is Impact Investing
Impact investing is all about leaving a positive impression. According to Wikipedia, an investment which is made into companies, organizations, and funds with the intention to generate a measurable, beneficial social or environmental impact alongside a financial return, is known as impact investing. Sustainable investing is all about leaving positive footprints in the society and the environment. As a result, Social Responsible Investing is also a part of impact investing.
Need for SRI
Money does not grow on its own. It needs to be invested. Likewise, we all speak about things not being right socially and environmentally. Often, we also speak about how the system itself is at fault. SRI gives us a way to kill two birds with one stone. Through SRI we can make the money grow and ensure that only ethical and green investments are targeted. Hence, to bear our responsibility towards our society while safeguarding the future financially, SRI is a must.
Today, there are many Mutual Funds and Electronically Traded Funds that meet the criteria for sustainable investment. Similarly, many corporations are also pulling their weight and incorporating ethical values. The future is bright. Make it brighter by investing right.