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Impact investing


SRI to dominate within five years, says adviser

UK – Socially responsible investment (SRI) will overtake traditional investment strategies within the next five years, according to the latest SRI report published by independent financial advisers Holden Meehan.

“Even those who have no particular ethical standpoint are finding socially responsible investment hard to ignore. Increasingly, as the notion of shareholder value based on short-term financial performance is seen as inadequate, companies are addressing socially responsible issues as an integral part of their strategic planning,” says Patrick Meehan at Holden Meehan.

“ Such policies are crucial in terms of reputation resilience, risk avoidance and long-term profitability. The negative publicity heaped on companies like Shell, Nike, Nestle and others in the past is testament to this,” he adds.

Meehan says that the “surge” of interest in ethical investing among the under 30s, the acceptance of environmental and social responsibility by multi-national companies and the increasing number of UK financial services companies with a presence in the “ethical” market, are indicators of SRI becoming a norm soon.

The new guide published by the advisers highlights the ‘best of sector’ approach, says Meehan, which managers use to pick companies with best environmental and social practice within their industry, to their portfolio.

“ Active engagement by investors is an increasing factor in improved performance as companies respond to environmental and human rights issues, especially as these investors are now represented by investment managers who have massive influence in the stock markets and a legal requirement to state the ethical criteria of the pension funds they run,” concludes Meehan.

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