Throughout the 1970s and 1990s, companies, pension funds, and individuals around the world stopped investing in South Africa. Since 1948, South Africa had been under Apartheid, a system of legal racial segregation enforced by the ruling National Party. Apartheid encouraged other human-rights violations such as torture, censorship, political repression, exile, and detention without trial.
To bring about change, outsiders divested their financial interests in the country. This forced financially struggling South African–based businesses (more than 75 per cent of all that country’s businesses), to negotiate for the dismantling of apartheid in 1994. In this case, socially responsible investing (SRI) was used as a tool to create significant change in society, business, environment, and government.
SRI has existed since the 1700s when religious organizations avoided “sinful” investments; for groups like the Quakers this meant insisting their members didn’t participate in the slave trade.
Modern ethical investing has become more complex as there are hundreds of investment products and fund managers directing their interests at a wide spectrum of social issues.
That’s where the new trends in socially responsible ETF investing fits in with the recent launch of three notable ETFs with the tickers HERS, CARS and CYBR. These style of funds make it easy to put your money into professionally managed SRI portfolios that are focused on gender-diversity, clean car technology and cyber security.
SRI comes down where you feel your money is most useful. Although Apartheid is a thing of the past, many other despicable social structures and issues thrive today. You have the power to create significant change using ethical guidelines to invest your money.
Disclaimer: For information on the specific funds we mentioned earlier, go here. We do not endorse or make investment recommendations. Consult your investment advisor before purchasing an investment.