An ethical investor's guide to buying shares - how to get started.
There are very few ‘ethical’ companies (not least because many of us have different ideas about what’s ethical) but some companies are more popular with ethical investors than others.
Most people who invest ethically do so by putting their money into pooled funds (that buy shares in dozens of different companies). But some people prefer the idea of hand-picking individual companies that they will invest in. It's not something to think about if you're not able to take on a higher level of risk and, if you’re investing ethically, you have make sure that the company has values are in line with your ethics and that it makes financial sense to invest in it.
Many pension funds own BP shares, but should green or ethical funds invest in it as well?
Some ethical funds have been criticised for investing in BP – if you’re thinking of investing in green or ethical funds, it’s vital to look in detail at their approach.
If you decided that you wanted your money to be invested ethically would you want to invest in a fund that bought BP shares? In view of the current storm of criticism over the explosion and oil spill in the Gulf of Mexico, possibly not. But you can't assume an ethical or environmental fund will take the same view. Last year I wrote a book called Green Money and I looked in some detail at ethical and green funds. What became clear is how different their approach can be.
If you want to invest your money in a green or ethical way, what can you do about your pension?
Millions of us have signed up to a pension, either through our workplace or by taking out a private pension plan, but the number of people who have an ethical pension remains very low. For some it just won’t be a priority, but others who may be interested in where their retirement funds are invested might be put off by how difficult it is to get information about ethical and green options.
