Responsible Investing – Just for tree huggers?

Responsible Investing – Just for tree huggers?

By Rebecca Woolstencroft, CEO, MB+M

There are many stereotypes out there, and one of them is that being ethical and making a decent return on an investment might not be achievable. 

What I mean is there is a firmly held view that if you look to invest in sustainable organisations that look to make a positive impact on the world that you would need to do so at the expense of a reasonable investment return.  I’ll admit I was one of them. 

I started a self-managed superannuation fund with my husband a few years ago and at first, I have to say I didn’t have too much interest in what I was investing in.  If it was diversified and made average market returns, I was satisfied.  However, in the last year or so my interest in what I invest in has shifted.

Part of this stems from some strong beliefs that corporations should do good, not harm.  So, I didn’t want to invest in tobacco or gambling.  This was the start of a slippery slope.  As I started to ask more questions, I discovered that there was way more to go if you were passionate about this.  Responsible investing is a process that considers environmental, social, governance, and ethical issues into the investment process of research, analysis, selection and monitoring of investments.  It has a broad spectrum depending on individuals’ views on what responsible investing might be.  The starting point might be like me with excluding certain industries.  Others might go even further to only investing in companies that produce goods with sustainability themes like clean energy or social impact.

I attended a great presentation on ethical investment at a recent accounting professional development day.  The leader of that division at a large accounting firm was able to confirm what I believed, that most people thought this type of investment was a bad choice from a return perspective, and that the financial planning sector was struggling to wrap their heads around this.  What was interesting was the information she provided which demonstrated that many of the ethical funds were in fact beating average market returns. 

It piqued my interest and I have recently been looking at a great website www.responsibleinvestment.org  which explains more about what responsible investment is.  More importantly, it enables you to decide where you are on the spectrum and identifies potential investment options.  Of course, the information provided is just that information.  It is not a recommendation to invest in these products, but simply to make you aware of them and with the appropriate advice decide which, if any of them, might suit your requirements.

So, for those who might think responsible investing is something they may be interested in, I’d highly encourage it.  I started out with a small percentage invested in our superfund, and as they prove their performance, I’m keen to expand this with the aim of investing in positive impact businesses in the future.  What is noticeable is that in the 18 months I’ve been interested the offerings have increased significantly.  This is a sign that investors can see a great option that delivers a good return, but also enables them to be making a positive contribution.  It’s also a great reason to have a self-managed superannuation fund as I control where my money is invested.

What we know is that money talks, so if investors start using their feet to choose better responsible organisations, then soon enough the big end of town will pay attention and dedicate more time in sustainable solutions that contribute for the long term.  Rather than pay lip service to an issue that is becoming critically important. 

If you know of some great businesses or responsible investments, feel free to mention them in a comment on our Facebook post or email me.

If you’d like to know more, please contact our Wealth Creation team who are happy to provide you with more information at no cost to you.  Contact us on 03 58219177.

**Please note that this is not financial advice.  Should you require specific financial advice for your needs, please contact your appropriately qualified financial adviser**

Additional Reading:
Responsible Investing
3 Questions To Ask When Choosing A Responsible Investment Option
MB+M Home + Services


Rebecca Woolstencroft – CA/GAICD 
Chief Executive Officer/Director
Email: rebeccaw@mbmgroup.com.au

Rebecca is a bundle of enthusiasm and energy when it comes to making sure that MB+M provides the best service it can to its clients.  The first part of this comes from ensuring that MB+M has a great team of people who share in the core values of MB+M and it’s number one principle “making your life easier”.  The first step to this is to ensure that her team love what they do, and they truly care about the people in their community.

Rebecca has been at MB+M for over 20 years, and pretty much tried every role they have.  Her passion currently is running the MB+M business from a strategic perspective so that she can continue in her role of advising and mentoring business owners in their daily challenge to run their businesses.

Outside of work Rebecca is a keen community contributor, currently as Chair of the GV Health board and assisting in a variety of community projects whether they be coaching a sports team, or sitting on advisory committees.  Her true passion is sport, and she loves a hit of tennis or run on the netball court.

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