Doing good for the neighborhood: Investing in socially conscious businesses

By Sharon Mallory

 

Many people think the stock market is a place where you invest in large businesses or risky tech stocks. These companies are usually located in states or countries far from your community, and rarely do you feel connected with them in a personal way. However, because of the return they may provide, you may feel this is the only way to invest your dollars.

But there are many companies that provide the opportunity to invest in socially conscious movements and earn a return on your investment as well. What does “socially conscious” mean? It means investing in companies that benefit your local community or larger global community and are in accordance with your personal beliefs and convictions.

 

INVESTING IS WHERE THE HEART IS

Investing in a socially conscious business could mean investing in environmental or fair trade companies, or those championing human rights. Maybe you are passionate about protecting wildlife or promoting healthy diet and exercise for young people. Whatever your area of interest and moral or ethical position, you may be able to find a company that supports your position either through the products they make, their location or their corporate mission.

 

INVESTING WITH ENTREPRNUERS 

Do you know of a local entrepreneur that is creating jobs in your community or taking time to work with youth, seniors or other groups and vendors to help them realize their dreams as well? When you partner with others locally or get to own shares in companies that are trying to succeed by doing the kinds of things you want to see done in your neighborhood, you have a chance to reap both financial rewards and personal satisfaction.

You can also invest in smaller companies outside your neighborhood that have a direct impact on the community you live in. Like many stock funds that have been created to specifically cater to the needs of people who want to play the market without compromising their own personal values, the creation of well-thought-out and planned smaller businesses just might give you the return on your money that you can see and feel.

 

INVESTING IN EXCHANGE TRADED FUNDS (ETFs) AND MUTUAL FUNDS

ETFs and mutual funds are a great way to delve into the socially conscious side of Wall Street. These are not single stocks, but groups of stocks that are managed by trained professionals in most cases. When you buy an ETF or share in a mutual fund, you are essentially allowing the fund’s manager to invest in funds that he or she thinks will do well and meet your investment goals. Because most funds value diversity of assets, they are somewhat protected from the risk of only owning shares of an isolated company.

 

However, I can’t stress enough that it is imperative that you do some background research to find out which local companies or funds meet your standards. Whatever you decide, take time to learn more, talk to a knowledgeable registered investment advisor in your community and schedule an appointment to have a candid conversation on your investment interest. You’ll be glad you did!

 

Sharon Mallory is the CEO of SDM Investments LLC, a registered investment advisory firm (RIA) in Merrillville, Indiana, and Chicago. Mallory is responsible for defining and maintaining the direction of the firm and ensuring clients’ financial planning needs are being met at the highest level of fiduciary responsibility. For more information, visit sdminvestments.com or call (888) 988-0858.