Green Tips: Sustainable Investing

NesteggPhoto: Benny Lin/Flickr

So you volunteer and make responsible purchasing decisions and give to environmental charities through the EarthShare @ Work program, but is it possible your retirement fund and other investments are undermining those efforts? How can you ensure that your financial investments aren’t hurting the planet? Socially Responsible Investing (SRI) and Impact Investing offer ways to finance businesses that are doing good while securing your financial future.

Here are some tips for getting into green investing:

  • Examine your holdings. Have you ever taken a careful look through the holdings in your mutual funds? Surprised to find some industries in there you find distasteful?  The first step in green investing is understanding how your money is being used and asking if your personal financial gains are worth the cost to the environment or society.
  • Ask your financial advisor if they offer socially responsible mutual funds. Most of the common financial companies now offer such options. In addition to environmental concerns, they may also screen for human rights, product safety and more. Make sure you understand the methods used to screen the companies in these funds.
  • Consider green investment companies. Besides the major financial companies that offer SRI options, there are many well-established companies that specialize exclusively in SRI funds. These include Calvert, Pax World, Winslow Green, and Domini among others. Check out socialfunds.com to learn more.
  • Do some research. Read the fine print to find out about fees you might have to pay. Decide whether you’d like to invest in small or large companies, domestic or international, or some mix. SRI funds have slightly underperformed their less scrutinizing counterparts historically, so plug your fund’s code into a website like Morningstar to get a sense of potential returns.
  • Invest in the community. Investing doesn’t have to be a dry, distant process. Many sites like Kickstarter, Kiva and Acumen Fund allow you to interact with the people benefited by your investment and stay engaged with the results. Whether you want to help someone set up an urban farm in North Carolina or run a small textile business in India, small-scale investing is rewarding beyond a financial statement.
  • Go beyond mutual funds. Have a friend who’s trying to start up a clean tech company? If you’re savvy enough, you might consider buying individual stocks in companies you care about. Find a green financial advisor or read books on the topic for advice on this trickier, but potentially more rewarding, domain.
  • Get active. As a stockholder, you have more sway with a company than the average person, so use your position to advocate for sustainable change. Known as “shareholder activism” stockholders can attend annual meetings, participate in proxy votes, communicate with management and more to suggest changes to company policies. Shareholders at ExxonMobil, for example, petitioned the company to take stronger steps to address climate change.


Socially responsible investment is a means to interact with your money beyond mere numbers. With SRI, you can harness the power of your investments for the betterment of society and the planet.

[The content here is provided for your personal information only, is not intended for trading purposes, and cannot substitute for professional financial advice. Always seek advice of a competent financial advisor with any questions you may have regarding a financial matter.]



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