Social Investing – Now and the Future

Socially responsible investing is an economic discipline that offers investors an opportunity to invest their money in a way that does not compromise their morals or principles. Also known as SRI or social investing, this financial discipline gives both, individuals and businesses an opportunity to invest in ideas in which they believe in, such as clean energy.

A growing number of people are becoming aware of the fact that unless companies start dealing with social, environmental, and ethical problems in the world, our future social welfare might be at stake. As a result of this concern, more and more companies are deciding to offer effective ways of modifying and controlling many unethical business practices through social investing options.

Putting limits on morally questionable business practices

Banks, financial institutions, and share holders are the ones who ultimately have power over corporations, and can therefore influence corporate business practices. By restricting or redirecting funds away from activities of which most people would disapprove, responsible control over corporate practices is exercised.

A company’s share price will obviously be negatively affected by share holders’ sentiments toward its morally questionable practices. Obviously, no company can afford such bad publicity. Even top corporations are starting to realize that they cannot remain invincible, and are now starting to provide social investing opportunities for investors.

Socially responsible investors also serve a purpose for controlling the free-markets in developing and developed economies. In a sense, social investors regulate the free markets by limiting unethical business practices. The unregulated free-markets are restrained socially by investors, and now have limits as to what they can do and not do on a moral or social level.

Growth of social investing and community investing

SRI is a booming market in both, the United States and United Kingdom right now. Assets in portfolios of social investors are currently nearing $3 trillion. Since 2005, SRI assets have increased more than 20%, and that number only continues to grow. According to financial experts, the SRI markets in the United States will reach $3 trillion within the next two years. The European SRI market is nearing