Making a responsible choice

MARYELLEN POLIKOFF SPECIAL TO THE JEWISH BULLETIN

The practice of tikkun olam, or repairing the world through social action, is one of the traditional categories of tzedakah – righteousness and justice, and the "setting straight" of the world.

Many of us are deeply committed to tzedakah through acts of kindness and charity but we might be unaware of the power that our savings and investments can have in the world through the actions of corporations and institutions. Since tikkun olam is identified with working for social justice, peace, freedom, equality and the restoration of the environment, the socially responsible investment (SRI) movement provides us with an opportunity to examine how our financial deeds play an important part of this effort.

Jewish teachings stress partnership and investment over mere charity, and there are opportunities to invest our savings in community development all over the world. We are keenly aware of the tragedy of overt oppression but it is more difficult to be aware of the more subtle forms of oppression that people might suffer due to corporate actions. Our history as an oppressed people should make us naturally sympathetic to this suffering. An awareness of a corporation's policies on wages and supply-chain ethics can help investors become agents of change.

There is much commentary in Judaism on our obligation to care for our resources and environment. Environmental concerns are growing exponentially and sustainable development is a global concern. Are the companies that we support through investment helping or hindering the repair of the environment? This information is becoming more available as corporations are expected to report on their environmental affairs and there are many mutual funds that have minimum environmental standards for investments. And if a corporation's environmental performance is considered acceptable based on lax environmental legislation or lack of enforcement, SRI investors form a unified voice to support higher environmental standards.

The Union of American Hebrew Congregations (UAHC) has passed several resolutions proclaiming their vested interest in socially responsible investing. In 1997, the 64th UAHC General Assembly acted on a suggestion from the commission on social action and reaffirmed Reform Judaism's longstanding commit- ment to socially responsible investing practices (www.rj.org/ uahc/dallas/areso/social.html).

SRI policies and practices are an organic expression of Reform Judaism's core beliefs. The UAHC worked closely with the Interfaith Centre on Corporate Responsibility (ICCR), an association of more than 250 faith-based institutional investors to develop guidelines and strategies that are now becoming common among religious organizations all over the world. The ICCR member organizations manage over $100 billion in assets and they sponsor major shareholder resolutions on social and environmental issues.

Even if an individual is not an investor, the SRI movement helps to inform us as consumers. Due to investor pressure, there is an enormous amount of public information available on corporate ethics and behavior, which might influence your decision-making when you are planning a purchase. This information can also be used to try and influence the companies you normally support. For example, if you are PetroCan cardholder, you can approach them as a loyal customer and express your concerns about their financial involvement in Libya.

There are many levels of commitment to SRI and most individuals and organizations have a wide range of criteria that determine how they will invest their money. Many investors have been unimpressed with the return on SRI investments compared to other products, and returns are usually the primary motivation for investment. SRI incorporates a social return factor and many investors adjust their financial expectations accordingly. Another frequent complaint about SRI or ethical funds is that the mutual fund screening standards are too low on some issues and many investors are disillusioned. Like any social movement, SRI has its problems, but it also has its solutions. It is possible to develop a strategy based on each individual's values, and it includes the decision-making processes and due diligence of standard investment management.

The Social Investment Organization (www.socialinvestment.ca) in Canada has been a starting point for many, and they provide basic information on SRI, as well as referral for SRI advice and products. The Social Investment Forum (www.iccr.org) is a well-developed U.S. organization with an enormous amount of information. Following are some other web sites that can help readers choose investment opportunities.

•www.rj.org/uahc/dallas/areso/social.html

•www.rac.org/issues

•www.socialinvestment.ca

•www.iccr.org

•www.responsibleshopper.com.

Maryellen Polikoff is an investment advisor and professional financial planner with Canaccord Capital. She specializes in socially responsible investing.

^TOP