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Investing/Strategies / Socially Responsible Investing
|Subject: Re: Why SRI?||Date: 11/10/2007 9:07 AM|
|Author: SunnyJames||Number: 2214 of 2247|
Your points are interesting about individual investors avoiding companies whose actions clash with that person's values. But even if I kept ironclad rules about avoiding stock purchases of, say, tobacco companies, chemical companies, or any company I feel is damaging the environment or hogging resources, I most likely STILL would not be able to avoid them if I am in any way connected with large mutual funds.
If I am indexed in a mutual fund, or if I participate in any type of retirement plan, I am most likely holding those types of companies, like it or not. If you check the top holdings of any of the biggest equity funds, you'll find many of the same companies represented; Exxon-Mobil and Altria (formerly Phillip Morris) are on countless Top 10 Holdings lists.
If institutional investors like state pension funds or huge mutual funds like American Funds have holdings that approximate the Gross National Products of small nations, what can you or I expect to accomplish with our few dozen or few hundred shares? Not much. In fact, we are more than likely even benefitting from the actions of these companies - enjoying the fruits of capitalism if you will - if our IRA's are growing as time goes by.
I think if you disapprove of what any company is doing you are better off participating in media campaigns or with a group of people that feel the same way as you do. You are much more likely to have an influence that way. If you feel that strongly, go pass the bar exam and do some pro bono work. Or be the next Mr./Ms.Smith who goes to Washington.
Companies do feel the sting of criticism - Wal-Mart, Nike and McDonald's come to mind. Some companies seem to get away with murder (Union Carbide, Dow Chemical and Blackwater). And some, like Enron, through sheer greed and rapaciousness just self-destruct.
One thing is for certain: We could use more representation at all levels of our political process for working/middle-class Joes who so often seem to have been elbowed out of it all.
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