Generally I come across as a fairly ethical person. I don’t believe in hitting people (except in self defense), being cruel to someone or destroying the environment. Yet my wife and I will gladly invest in a stock (EIT.UN) that owns some of the biggest green house gas emitters in this country. Am I alright with this? Yes. How? Now that’s a good question.
Investing is the strange word for most people where all the normal rules go out the window. A person may believe in non violent conflict resolution yet hold a mutual fund that owns companies that build guns for the US war in Iraq. How can this contradiction exist? We often don’t get into the details of our own holdings. As long as they are performing well, we tend to just ignore them entirely.
Yet in my case I am aware of most of my holdings and I still don’t feel bad or have a problem with it. Why? Because I know that investing is one of those weird worlds where ownership matters. If I really dislike something a company I own is doing I will send them a note and vote accordingly at the Annual General Meeting. Companies are accountable to their shareholders, if you are one you at least have the chance of getting your issues to the table. If I don’t own them, then they will just ignore me entirely.
So the next time someone tells you they invest in ‘ethical funds’, have some fun and point out what they are missing by not buying shares in these ‘bad’ companies.