As the world becomes more socially and environmentally aware, people are beginning to look more seriously at ethical investments. Growing numbers of investors are starting to ask more detailed questions about where and how money is being made, and often actively seek out investment funds that offer responsibly managed options.
But how can advisers give detailed advice on ethical investments? Should you encourage your clients to invest in these options? How do you know what’s responsible and what’s not?
Responsible Investment Association Australasia (RIAA) is a good place to start. They produce detailed research, investigating various funds and reporting on their environmental and social impact. Their approach is holistic, and looks beyond the bottom line to determine if an investment really does meet the requirements to be considered responsible. A list of their members can be found on their website, a great resource if you’re asked about a specific investment option.
Choice have also produced an article breaking down ethical investment into categories to make it easier to explain it to clients, encouraging them to do their own independent research to be more confident with their investments.
These resources ensure you are equipped to answer the client’s questions with the investments they’ve chosen. If ethical investments are available on your AP list the number of people interested in these products is growing so it can be a good way to start a conversation to gauge their interest.