The case against ethical investing
Don’t get me wrong: I’m a huge fan — to a problematic degree, some might argue — of socially responsible companies. That said, giving up on ‘good’ companies and embracing the ‘bad’ and the ‘ugly’ has its merits – both from a financial standpoint and an ethical one.
Undoubtedly, there are industries doing harm in the world: oil companies, gun makers, tobacco, gambling, and the rest of them.
A rising number of investors refuse to own stocks or funds operating in these industries, and instead put their money in companies considered to be socially responsible. Ethical investing has boomed over the past decade.
Maybe you sleep better at night knowing that your dividends are paid by solar panel manufacturers rather than cigarettes makers. Fair enough.