What is socially responsible investing?
Socially responsible investing (SRI), also known as ethical investing, is any investment scenario which takes into consideration investment return and social good, in the aim of social change. There is also a sub category of this called impact investing, which aims to bring about a positive social impact through investing.
Key takeaways
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Socially responsible investing (SRI) balances investment returns with social good to create change, including a subcategory called impact investing.
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SRI origins trace back to the 1700s with John Wesley's Methodist sermon outlining fundamental principles of ethical social investing.
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Modern SRI emerged in the 1960s addressing civil rights, women's equality, and labor through initiatives like Dr. Martin Luther King's programs.
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SRI played a crucial role in ending South African apartheid, with Reverend Leon Sullivan creating the Sullivan Principles in 1971.
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Investors interested in SRI can explore shareholder advocacy as a related practice for engaging in ethical investing.
Where have you heard about socially responsible investing?
The origins of socially responsible investing has links as far back as the 1700s. One of the most prominent users of SRI was John Wesley, one of the founders of Methodism. His sermon “The Use of Money” stated the fundamental practices of social investing.
What you need to know about socially responsible investing...
A more modern sense of socially responsible investing was brought about in the 1960s, with socially aware investors striving to address civil rights, women's equality and labour issues. Certain economic development projects that were started or maintained by Dr. Martin Luther King such as Operation Breadbasket or the Montgomery Bus Boycott established the framework for socially responsible investing practices. Socially responsible investing also played an important role in ending the apartheid government in South Africa. In 1971 Reverend Leon Sullivan devised a code of conduct for all business practices in South Africa, which became the Sullivan Principles.
Find out more about socially responsible investing...
If you are interested in SRI, take a look at our page on shareholder advocacy.