green mutual funds en-US Socially Responsible Investing Goes Green <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/socially-responsible-investing-goes-green" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src=" landscape.jpg" alt="Madagascar landscape" title="Madagascar landscape" class="imagecache imagecache-250w" width="250" height="175" /></a> </div> </div> </div> <p>You drive and drink responsibly, spend your money responsibly, and act responsibly, don’t you? But do you <strong><em>invest </em></strong>responsibly? Can you invest responsibly? Is there such a thing as investing in socially responsible companies and, more specifically, investing in companies that are environmentally responsible (aka green) and socially responsible? If so, what does being <strong>green</strong> mean and for that matter, what does being <strong>socially responsible</strong> mean? </p> <p>When I think of <strong>green investing</strong>, I think of buying shares of companies or mutual funds that invest in companies that fulfill 2 or more of the following criteria:</p> <ul> <li>design, market, sell, manufacture, and/or distribute products or services that harness or deliver renewable sources of energy;</li> <li>design, market, sell, manufacture, and/or distribute products or services that deliver energy savings;</li> <li>have passed some sort or environmentally-based selection process or “screen” in the lingo of mutual fund managers;</li> <li>have embraced sustainability as a primary business concern;</li> <li>are socially responsible.</li> </ul> <p><strong>Socially responsible</strong> <strong>investing (SRI)</strong> conjures up images of buying shares in companies with well-treated employees of diverse backgrounds who are paid a fair wage, and are paid and promoted based on merit and contribution. Depending on the SRI criteria, these companies may also <em><strong>not</strong></em> design, market, sell, manufacture and/or distribute products or services that include tobacco, weapons, and gambling. </p> <p>So, how do you find an SRI mutual fund or green fund? And once found, how do you evaluate its social responsibility and greenness? I&#39;ve done some research and found 3 funds with varying interpretations of green. I found Winslow Green Growth through an <a href="" target="_blank" title="">article on</a> and came upon Portfolio 21 and New Alternatives via mentions on a user forum of <a href="" target="_blank" title="">Wesabe</a>, a community of people who share information about money. </p> <p>Information presented below has been gathered from fund and company websites in October 2007:</p> <p><strong><a href="" target="_blank" title="">Winslow Green Growth</a></strong> (WGGFX) </p> <ul> <li><strong>Environmental Screen</strong>: positive or neutral impact on the environment;</li> <li><strong>Definition of Green</strong>: provide environmental solutions and/or pioneer green business practices often in the areas of renewable energy, healthy living, energy-efficiency, and green solutions;</li> <li><strong>Investment Focus</strong>: small cap, growth, domestic;</li> <li><strong>Social Responsibility Screen</strong>: none that I could find;</li> <li><strong>Holdings include:</strong><br />1. <a href="" target="_blank" title="">SurModics Inc</a>., provider of surface modification and drug delivery solutions for medical device and biomedical applications; <br />2. <a href="" target="_blank" title="">Green Mountain Coffee Roasters Inc.</a>, company engaged in the sourcing, roasting, and sale of estate, certified organic, Fair Trade Certified™ signature blends, and flavored coffee through wholesale, direct mail, and e-commerce distribution channels;<br />3. <a href="" target="_blank" title=" ">Fuel-Tech Inc.</a>, provider of solutions to meet the pollution control, efficiency improvement, and operational optimization needs of energy-related facilities;<br />4. <a href="" target="_blank" title=" ">Orbcomm</a>, global satellite data communications company with machine-to-machine (M2M) communications;<br />5. <a href="" target="_blank" title="">WFI Industries</a>, provider of geothermal heating and cooling systems for residential, institutional, and commercial applications.</li> </ul> <p><a href="" target="_blank" title=""><strong>Portfolio 21</strong></a> (PORTX)</p> <ul> <li><strong>Environmental Screen</strong>: complex <a href="" target="_blank" title="">Company Evaluation Criteria</a>; companies that &quot;understand ecological risks and opportunities” and are “taking positive action to integrate sustainability strategies in their business models”;</li> <li><strong>Definition of Green</strong>: companies that create ecologically superior products, use renewable energy, develop efficient production methods, and/or recognize environmental sustainability as a challenge and opportunity.  </li> <li><strong>Investment Focus</strong>: primarily large cap, international;</li> <li><strong>Social Responsibility Screen</strong>: excludes companies with negative performance in employee relations, human rights, community involvement, or product safety; and those with significant business activities relating to nuclear energy, tobacco, gambling, or weapons;</li> <li><strong>Holdings include:</strong><br />1. <a href="" target="_blank" title=" ">Nokia</a>, telecommunications company; <br />2. <a href="" target="_blank" title="">Novo Nordisk</a>, healthcare company with core business of pharmaceutical drug development;<br />3. <a href="" target="_blank" title=" ">IBM</a>, technology company focusing on business services; <br />4. <a href="" target="_blank" title=" ">HSBC Holdings</a>, financial services company providing personal, business &amp; commercial, corporate &amp; institutional, and private banking services;<br />5. <a href="" target="_blank" title=" ">Novartis</a>, pharmaceuticals and nutritional products company.</li> </ul> <p><a href="" target="_blank" title=" "><strong>New Alternatives Fund</strong></a> (NALFX)  </p> <ul> <li><strong>Environmental Screen:</strong> emphasis on alternative energy sources but includes companies with products and services associated with recycling, natural foods, clean water, clean air, and natural gas;</li> <li><strong>Definition of Green:</strong> positive impact on the environment;</li> <li><strong>Investment Focus:</strong> subjective but includes evaluation of price and risk;</li> <li><strong>Social Responsibility Screen:</strong> does not invest in oil, nuclear power, weapons, or tobacco or  companies with business practices that allow discriminatory hiring, unfair labor, detrimental environmental, or animal testing activities.</li> <li><strong>Holdings include: <br /></strong>1. <a href="" target="_blank" title="">Renewable Energy Corp. AS</a>, producer of silicon for solar cells;<br />2.<strong> </strong><a href="" target="_blank" title="">Acciona SA</a>, construction and infrastructure company with activities that include renewable energy including wind, small hydro, biomass, biodiesel and solar sources; <br />3. <a href="" target="_blank" title="">Abengoa SA</a>, engaged in biomass (ethanol cellosic project), solar projects, and aluminum recycling;<br />4. <a href="" target="_blank" title=" ">Vestas Wind Systems Abengoa SA</a>, wind turbine manufacturer;<br />5. <a href="" target="_blank" title="">Schneider Electric SA</a>, distributor of efficient electrical devices.</li> </ul> <p>I enjoyed visiting Portfolio 21&#39;s website for a few reasons: 1) its perspective on what &quot;green&quot; is with a recognition that though companies strive for sustainability, nearly all create some (negative) impact on the environment; 2) profiles on all companies selected for investment with explanations of why these were chosen; and 3) some information on companies that have not passed its sustainability evaluations.  </p> <p>Oh, you might want to know about the financial performance of these funds; here are 5-year returns (as of October 8, 2007):</p> <ul> <li>Winslow Green Growth: 29.28%</li> <li>Portfolio 21: 21.63%</li> <li>New Alternatives: 24.59%</li> </ul> <p>If you want to align your investing values with personal values, you can check out socially responsible funds and/or green funds such as these. For more on SRI, visit <a href="" target="_blank" title="">Social Funds</a>. </p> <p><em>Disclosure: I do not own shares in Winslow Green Growth, Portfolio 21, or New Alternatives funds.  </em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="">Julie Rains</a> of <a href="">Wise Bread</a>, an award-winning personal finance and <a href="">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="">5 Stocks to Buy If You Love the Earth</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="">A Simple Guide to Socially Responsible Investing</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="">5 Easy Ways to Start Green Investing</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="">Investing With Your Values</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="">11 Investment Mistakes We All Make</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Green Living Investment green investing green mutual funds mutual funds socially responsible investing SRI Mon, 08 Oct 2007 17:20:31 +0000 Julie Rains 1265 at