“Social investing”: How Altruistic Funds Can Be Bad For You
Are you part of a public pension fund? Then take a hard look at your next quarterly report and see if your fund is performing as well as benchmark indexes.
Chances are the answer is no. Especially if those in charge are making “social investing” decisions based solely on prejudices against fossil fuels, gun manufacturers or alleged “terrorist states,” according to a study by the Center for Retirement Research (CRR) at Boston College.
If the goal of those who manage the fund — known as “fiduciaries” — is altruistic, then they’re using your money for their purposes. According to the CRR, not only will future beneficiaries who count on collecting a pension when they retire be hurt financially, but so will taxpayers, who would be financially obligated if their state’s pension fund is short of money, as many already are.
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