An Investor Responds
An investor responds to a recent Wall Street Journal column on socially responsible investing:
Dear Dave Kansas,
I read your article —http://online.wsj.com/article/SB126429172780434317.html — with interest because I have been invested in socially responsible mutual funds (also referred to as sustainable investing) since 2002. Given the turmoil of the past decade, I would say I've done as well as others who do not follow this investing path.
Your article misses the point. The core issue is not whether sustainable investing creates comparable returns to non-sustainable investing. (Research has indicated that the returns are comparable). The core issue is whether a person is developing a consciousness and conscience regarding the one's stewardship of one's money. I believe a person should bring that awareness to every aspect of one's use of money, not simply regarding the investment world… from where one shops to how one tips at a restaurant. It is about how one develops an ethical orientation and process as one engages the economic world.
I totally disagree with your final paragraph: " A wiser approach…." This is the mentality of being ignorant about one's participation in the world… about living life in an unconscious manner. As a doctor in Haiti said as he showed a cameraman a front end loader scooping up bodies to put them into a truck to be hauled off to a mass burial: "People need to see this so that they don't go about their lives in ignorance."
Your "wiser approach" is simply saying: it doesn't make a damn bit of difference what you invest your money in… whether it's slave ships from Portugal, whether it's the cod shipments from New England to the slave plantations in the Caribbean, whether it's the land mines of Cambodia, or whether it's tobacco destroying your lungs. Forget about those issues. Just make as much money as you can and give a few crumbs to charity and you can live "peacefully" in ignorance. Why be bothered.
Yes, sustainable investing is not perfect. Nothing is. But it is the prodding of a social conscience that is critical. Even if I don't make as much money through sustainable investing as the person who doesn't give a damn, so what? Am I to sell my soul to the mutual fund or stock that has the best net return? For me, I say "No Way."
You are simply promoting the "old bottom line" approach and then buying off an already "dead conscience" with a check to your favorite charity. Regarding "saving on fees," just remember that one pays some price when investing. The "gatekeeper" always collects his fee… you're worried about extra cost… I worry about my conscience being collected.
With kind regards,
Note: Kevin O'Keefe is Chief Investment Officer of First Affirmative. The author of this letter is an individual investor, not Mr. O'Keefe.
Posted: February 2, 2010