Posts Tagged ‘shareholder activism’

Socially Responsible Investing (SRI) is…

Tuesday, April 12th, 2011

Socially responsible investing connects your interests and personality to your financial resources. When you invest in a socially responsible way, you ensure that your portfolio earns a competitive rate of return while also making a positive social and environmental impact. For example, you might invest in companies that have good employee relations, diversity in the workplace, a commitment to clean air, or that use sustainable forms of energy.

Companies are deemed socially responsible by research firms such as Calvert, Social Funds, and KLD Research & Analytics. They evaluate a company on its level of social responsibility based on the quality of its social, environmental, and governance (management) policies.

So how do socially responsible investors find a company they want to invest in? They use a process called screening, which considers whether or not a company’s values align with their own. For example, some investors screen out companies that pollute, that abuse their workers, or that produce harmful products like cigarettes.

Once you’ve found a company you like and decide to invest, you become a shareholder of that company. At socially responsible companies that means you stay involved and informed in the goings-on of the business. This is because socially responsible management is committed to keeping shareholders in the loop, and shareholders are encouraged to be involved corporate management.

Socially responsible investing is also called mission-based investing, sustainable investing, ethical investing, green investing, responsible investing, and value-based investing.

Shareholder Activism is…

Wednesday, October 6th, 2010

Shareholder activism is when a shareholder of a publicly-traded company uses their rights to pressure that company to make change. Basically, it’s a way that shareholders can influence and change a company’s behavior in a certain way. For example, shareholders may influence a company to become more environmentally friendly or disinvest from a country with a record of human rights abuses. Shareholder activism can take the form of voting for or against certain corporate actions or members of management, and/or in organizing groups of voters to block or force a corporate  action.

Shareholder Advocacy is…

Wednesday, October 6th, 2010

Shareholder advocacy is when people who own stock in a company (and therefore technically own part of the company) use their influence to promote corporate responsibility. Basically it means that you use your voice within the company, however small, to encourage the company as a whole to practice policies that are socially and environmentally responsible. Yeah, you can really do that!