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Wealth management firm urges greater awareness in investments


Rutland-based Chartered Financial Planning firm, Efficient Portfolio, has called for more awareness when it comes to making ethical investments.

This follows the news that an open letter, signed by charities such as Joseph Rowntree Charitable Trust, the RSPB and the Quakers, has asked for specific guidance on whether they should invest in companies that contribute to dangerous climate change.
Last year, the National Trust was criticised for investing in a fund with holdings in fossil fuel companies, while the Church of England was shown to have ploughed funds into Wonga, despite having publicly criticised the payday lender.
Chartered Financial Planner and founder of Efficient Portfolio, Charlie Reading, says: “For many, there is a fine line between personal-gain and contributing to the world around us. We all have our own needs, wants and hopes, and it’s often not viable to sacrifice our own wellbeing to help others, despite an urge to do so. This call from many charities brings up the issue of investments that align with your own values. We argue that this applies not only to big business and the charitable sector but the individual too.
“The question that needs to be asked is, should you invest in something that doesn’t align to ethics you agree with, even if it stands to make you significant amounts of return?”
Charlie suggests that although we are starting to pay heed to the warnings over global warming and are now fervently fighting to save our planet – being ‘green’ and socially responsible is becoming more than a fad – it’s becoming a way of life that is crucial to the future of our planet. This, he says, means that individuals’ financial planning is now starting to reflect this more and more.
He continues: “Most importantly, people are genuinely passionate about it. It’s not that we’ve suddenly learned compassion, it’s that we now have more opportunities to play an individual role in the battle to save our surroundings.”
“Over the last few years, ethical investing, or ESG (Environmental, Social and Governance), has provided many with an opportunity to grow their own personal wealth whilst sustainably investing and acting with social responsibility. Ethical Investment incorporates environmental and social factors when selecting funds, but also aims to provide a competitive financial return.”
“Whilst it would not be prudent to try and compare the returns from the ‘old stock’, such as tobacco, alcohol and arms, with the new ‘green kids on the block’, many experts are suggesting that Ethical Investing is on the brink of something big.
“It is important, however, to note that ethical investing can increase your investment risk, and can potentially reduce the investment returns. Why is that? Because by limiting your investments to only ethically focused companies, you limit the pool of investments that can be selected from.
“This is why we are calling for more awareness of ethical investments in general, the more individuals and businesses large or small are aware, the better the decisions when it comes to investments made will be made.”

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