Creating a Financial Portfolio that Reflects Your Values
As a socially conscious investor, you may want to create a financial portfolio that reflects your values. You can align your investments with your beliefs generally in one of two ways: negative screening (Socially Responsible Investing) and positive screening (Environmental, Social and Governance). Each is implemented differently and understanding their nuances can help you select investments. In a nutshell, Socially Responsible Investing (SRI) allows investors to avoid companies they dislike for ethical or moral reasons.
Environmental, Social and Governance (ESG), on the other hand, focuses on the analysis and inclusion of these issues when evaluating investment opportunities. Both strategies, of course, should seek to maximize financial return for the amount of risk taken.