Ethical & Sustainable Investing

Ethical & Sustainable Investing

Ethical and sustainable investing offers an opportunity to align investments with values that consider environmental, social, and governance (ESG) factors.

Whilst negative screening has traditionally been the foundation of many ethical investment approaches, positive screening—assessing companies based on environmental, social, and governance (ESG) factors is becoming increasingly recognised. This approach considers how an organisation addresses climate change, promotes diversity and human rights, and ensures transparency in governance structures. By combining both positive and negative screening, investors can build portfolios that align with their ethical and sustainability preferences.

Investing this way can involve active engagement, with fund managers encouraging companies to improve their social, governance and environmental practices. These practices should reflect their impact on the environment, society, and governance.

Ethical and sustainable investing involves three main types of Ethical funds:

• Negative screening avoiding companies that do not meet the fund’s ethical standards. Industries most commonly excluded include alcohol, tobacco, gambling, pornography, animal testing for cosmetic purposes, genetic engineering, intensive farming, arms/military engagement and nuclear power.
• Positive screening selects companies actively contributing to ESG improvements, such as those with strong climate strategies, commitments to diversity and human rights, and transparent governance.
• Alternative Approaches - Some funds focus on companies involved in renewable energy, clean technology, and innovations aimed at reducing environmental impact. Others may invest in organisations that support charitable initiatives or promote broader social responsibility.

We can recommend portfolios that are tailored to the level of risk that we agree is right for your circumstances. But it is important to remember that when investing ethically the same risks and principles apply; diversification (and good advice) can be the keys to reducing risk.

We discuss your sustainability preferences with you as part of our advice process. The solution we recommend will depend on those preferences, as well as your objectives and attitude to risk, and full details of any recommended solution will be set out in your personal recommendation.

If you would like to know more about our Ethical & sustainable investment solutions, please do not hesitate to contact us.