Naughty or nice? Companies making it onto our fund managers’ nice lists
With Christmas nearly upon us, parents around the country* are using blackmail to encourage good...
As consumers, we are getting better at minimising our impact on the environment: from cycling or walking instead of driving to recycling as much of our household waste as possible.
Given an incentive, we’ll make even more of an effort: before the 5p charge on plastic bags was introduced in October 2015, each of us was using around 140 a year. Now we use 25* and there has been a 30% drop in single-use bags found in the seas around Britain.
But while we’ve been happy to take action in our everyday lives, when it comes to our investments we’ve been a little slow on the uptake. Although ethical funds have been available for three decades now, of the £1,231 billion invested by UK retail investors, just 1.3% (£16.3 billion) is in ethical funds**.
Time to put our money where our mouth is?
29 September 2018 marks the start of ‘Good Money Week’. The annual campaign is designed to raise awareness of sustainable and ethical options when it comes to your bank, pension, savings and investments.
To mark the occasion, here are our Elite Rated ethical funds: funds that can make a profit without sacrificing your principles:
EdenTree are pioneers of ethical investing and offer even the most discerning client a justifiable investment opportunity. Sue Round has been a the helm of the Edentree Amity UK fund for more than three decades and invests in UK small and medium-sized companies. All potential investments must pass a rigorous multi-factor screening process and from those that do, Sue looks for stocks that are currently undervalued and out-of-favour, but with the potential to increase in value.
This fixed income fund invests in quality investment grade bonds. It has a high income target and its manager, Bryn Jones, excludes a number of companies from the portfolio that are deemed to be unethical: those involved in mining, arms, gambling, pornography, animal testing, nuclear power, alcohol or tobacco. All portfolio holdings must also have at least one positive environmental, social or corporate governance quality.
Manager Lesley Duncan uses a ‘no compromises’ ethical screening to construct a portfolio of best ideas. She is adamant that you can invest without compromising on your values and beliefs – and without compromising on your returns. The fund typically holds between 50–100 holdings, and Lesley will aim to keep them for three to five years, expecting them to grow in value, and also provide some income.
*Source: UK government website and The Guardian, April 2018
**Source: Investment Association, June 2018