The value of pensions and investments and the income they produce can fall as well as rise. You may get back less than you invested.


Socially responsible or ethical investing is categorised as any investment strategy which seeks to consider both financial return and social good. The areas of concern recognised are often summarised as those of environment, social justice and corporate governance.

In general, socially responsible investors encourage corporate practices that promote environmental stewardship, consumer protection, human rights and diversity, whilst avoiding businesses involved in alcohol, tobacco, gambling, pornography, weapons and/or the military.

We are constantly aware of the significance of ethical investment, it’s in our DNA to want, wherever practical, to examine responsible investment in a form that suits each client’s situation.

The value of pensions and investments and the income they produce can fall as well as rise. You may get back less than you invested.

What is ethical investment?

Ethical, or Socially Responsible, Investment offers the opportunity for investors and savers to avoid the companies whose activities they would not want to support, and invest in those operating within a moral framework that reflects their own moral stance.

The first ethical investment fund in the UK was launched in 1985 by Friends Provident as a direct result of their Quaker roots. 32 years later there are dozens of funds from many of the UK’s leading fund management groups. Whatever your concern, people, planet, animals, faith, there is now an ethical fund that will match your views. The concept of ethical is going to vary between individuals, and one man’s meat is another man’s poison. In our experience there are certain key moral issues that are deemed to be beyond the pale for all investors, but beyond that it is possible to apply more personalised and bespoke views upon the manner in which one’s money is invested. This includes, for an increasing number of investors, not just avoiding certain activities but actively investing in a positive way; to support companies contributing to a sustainable future.

After nearly 5 years advising on ethical investments, it is still interesting to note that far too many investors with social, moral or environmental concerns have yet to make the link between their areas of concern and their money. The link is, in reality, quite simple; if you do not actively choose to invest in a socially responsible fund, most, if not all, of your concerns will be compromised by your investments. So, the next time you are reviewing your financial arrangements – banking, pensions, life assurance, savings, ISAs etc – take a step back and look at whether you are financing companies whose activities you are against, and whether you are actively investing in your future, of that of your children, to make a positive difference. It is your money and your choice.

Does it make a difference?

If one recognises that the most influential part of modern life, like it or not, is the money system, then until this changes, animals, humans and the environment will continue to be abused in the name of profit. Socially Responsible Investment aims to maximise long-term profits balanced with concern and respect for wider social issues.

It is easy to feel that an individual cannot influence the money system, but we believe this is wrong. The faster Socially Responsible Investment grows, the greater the pressure on the investment institutions, banks and insurance companies to move away from those areas involving socially irresponsible practices. The rapidly increasing concern amongst the public over the treatment of animals, people and the environment is, we believe, making companies involved in these areas less viable as a long term investment. In other words, the economics of Socially Responsible Investment are now more widely recognised as a sound long term investment strategy. The combination of consumer and investment pressure can bring about lasting change – change which will benefit people, animals and the environment.

Sound financial strategy…

Investing in an ethical and socially responsible way is now acknowledged as a sound medium to long-term strategy. Whilst there will be those who are happy to make easy money at the expense of others, the rapidly increasing trend for individuals, charities and companies is to seek profit responsibly via ethical investment. After all, who would disagree with investing in companies that have good employment records, manufacture products that people want to buy at a fair price, and on which a good profit is made? It is important to remember that much of Socially Responsible Investment concerns the positive sides of business life such as respect for the community (local and global) and for the environment. In these troubled times, an enlightened attitude to our responsibilities to future generations is imperative in business, if a company is going to survive.

How can I invest ethically?

Many of us at some time in our lives will need at least one of the contracts listed below and any of these can be linked to a socially responsible fund. By Virtuo Group advising the contract you need and then recommending the fund which best suits your needs, you will be joining a growing core of people who are making a positive statement with their money. The contracts available include:

  • Stakeholder & Personal Pension Plans
  • Additional Voluntary Contribution Plans
  • Company pension schemes
  • Self Invested Personal Pensions
  • Life assurance
  • Regular savings
  • Lump sum investments
  • Individual Savings Accounts
  • Discretionary Fund Management

What are the criteria?

Generally speaking, the criteria used to select a company considered suitable for a socially responsible fund can be split into two groups. The first are those which make a positive contribution, while the second are those which are known to have a negative social or environmental effect.

The positive…

Positive selection will result in support and encouragement of companies that are associated with the following:

  • Environmental protection
  • Pollution control
  • Conservation and recycling
  • Safety and security
  • Ethical employment practices

The negative…

Negative selection can result,where required, in the avoidance of companies linked with any or all of the following:

  • Armaments and nuclear weapons
  • Animal exploitation
  • Human Rights Abuse / oppressive regimes
  • Environmentally damaging practices
  • Poor employment practices
  • Alcohol
  • Tobacco
  • Gambling
  • Pornography