DiaryINDEX｜past｜will
| 2003年04月24日(木) | Can I improve my way to spend money? |
Excerpts
Investing with a conscience
By Nick Louth
Here's a funny thing: my mother smokes like a chimney, but would never buy shares in a tobacco company.
私の母親は煙突みたいにタバコを吸うのに、決してタバコ会社の株を買おうとは
しない。これはおかしい。
And she's not the only one with strange habits. A friend of mine keeps all her money in the Post Office because she distrusts companies, yet she works like a slave for one of the least trustworthy companies I know.
おかしな習慣を持っているのはうちのお袋さんだけではない。民間企業を
信用できないので郵便局にしかお金を預けない友人もあるが、彼女は一番
信用できない会社で奴隷のようにこき使われているのを私は知っている。
（なるほどねー！そういうところなきにしもあらずだわ、私にも）
A relative was reluctant to accept shares in his demutualising building society because he felt he was being "bribed with his own money".
An acquaintance refused to fly on holiday because of airlines' contribution to global warming, but made his girlfriend drive him everywhere (which is hardly going to help the environment). She finally dumped him, though 'recycled' might be a better word to describe it.
What price principle?
Ethical behaviour is peculiar to the individual, and ethical investing equally so. If ethical investing doesn't restrict your investment universe, then it is meaningless. But how restricted do you want to be, and how much should it cost you in lost profit performance?
For many people the whole investment arena has always been tainted, recent proof furnished by the exposure of book-cooking scandals, sweatshop suppliers and fat cat pay.
This ascetic view at least has the benefit of consistency, but confining yourself to Post Office savings accounts is certainly going to cost you dear in the long-term.
If you had invested £100 in shares in 1945 it would now be worth £84,226 (with dividends reinvested), whereas had you kept the same £100 in cash, earning interest in a savings account, it would be worth just £4,394.
I suspect this doesn't worry my friend who keeps her savings at the Post Office. For others with a more material view, however, a balance needs to be struck between the worst corporate behaviour and that which is intrinsic to the system in which we live.
Typical industries to avoid investing in if you've got a conscience include tobacco, defence, nuclear power, brewing and distilling, gambling, animal testing, oil, and anything with a dodgy environmental record.
For indirect involvement, this list could be extended to include furniture chains which stock items made of tropical hardwoods, pharmaceutical groups which farm out their animal testing to private companies, and supermarkets which stock any products we disagree with.
Investment companies, being at the top of the financial food chain, stand through their own investment record as tertiary beneficiaries of whatever it is that contravenes our principles.
Only part of the story
The trouble is that investing is but one of the many ways in which we connect with the corporate world. What is the point of avoiding the shares of a company if we still buy its products? Or if – like the nuclear power stations of British Energy – our taxes still underwrite them? Or if we still work for them?
For a pinnacle of daftness, a colleague at my old employer Reuters declined to contribute to the SAYE share option scheme because he didn't approve of the way the company was run. Yet he was still working there a few years later, merely poorer than everyone else.
Investing is actually quite a weak connection with a firm. For the overwhelming majority of transactions, shares are bought not from the company, but from another person. While that company may pay you dividends, you pay them nothing.
Indirectly, yes, the secondary capital market helps prop up the primary one – but the biggest ogres like the tobacco companies are more likely to be buying back shares at the moment than issuing them. However, when I tried this one on my mother – thinking it would be a good idea for the tobacco industry to support her as she had so long supported them – she would have none of it.
Furry logic恐ろしい論理
furry adj.毛皮の、(米俗）恐ろしい
It reminds me of a furious student row many years ago, in which a friend of mine was being lambasted for buying a fur coat (by me, among others). Cornered by the righteous, she tearfully yelled that seeing as the purchase was second hand, no animals died on her account.
An earnest post-mortem followed on to what extent the buoyancy of the second-hand fur coat market would encourage trapping of more cuddly creatures. Ah, student days...
Positive action
If ethical investing is designed to make industry mend its ways, then it has had some effect. The trouble is that the social responsibility policies slickly adopted by many of the larger companies seem to be regarded as another overhead of modern business, rather than any real change in the corporate heart.
Corporate behaviour, after all, adapts to the laws and mores of the countries in which it operates. The biggest problem may be among privately owned companies, which have far fewer disclosure duties than their listed competitors.
By contrast, owning shares in a 'bad firm' gives you some power. Listed firms allow you to make a nuisance of yourself at the annual shareholders meeting, a tactic practised to great effect by anti-apartheid campaigners at Barclays, and environmental activists at Shell.
Gordon's gin?
The UK government has always had a pragmatic view. Tobacco and drink can be taxed for all sorts of health reasons, but the Treasury would be mortified if people really started to give up consuming them. Where would all that tax money come from?
Despite all this, ethical investing is big business. In the US it more than $2,000 billion is invested in socially-screened funds. While smaller over here in the UK, ethical investing has prompted the formation of its own benchmark, the FTSE4Good, a series of indices launched in 2001.
It isn't necessary to do the research yourself to find the 'good guys', because there are now numerous websites which offer everything you need. The site www.eiris.com is a good start, detailing 2,500 companies worldwide on many ethical points from involvement in pornography to ozone-depleting chemicals (I couldn't find any involved in both).
There is also a section on ethical banks and mortgage lenders, and ways to check that your or other fund investment is following socially responsible investing criteria.
There is also an IFA directory and, at the UK social investment forum (www.uksif.org) information on the policies of UK occupational pension funds.
At www.islamic-banking.com and at www.ihilal.com there are pointers on investing in line with Shariah law principles, which eliminate (or effectively restructure into capital) the application of 'riba' or interest as part of the Islamic ban on usury.
No cost in performance
So are your principles going to cost you money? Probably not, on balance. The FTSE4Good global index has outperformed the FTSE All-share index over the last two years by a shade under 10 per cent.
In practice much depends on the relative performance of the big bad guys – primarily tobacco. When defensive firms are in favour, they will do well, and ethical investments probably underperform.
So what is the answer? When I was a student in the 1970s, my room mate had an interesting strategy, which would now be termed something like 'destructive engagement'. He banked with the bank he most hated (Barclays, because it remained invested in South Africa despite the country's apartheid policies). He ran up an enormous overdraft, spent it all on LPs by obscure anarchist bands and then moved digs so they couldn't find him.
I think he's something in the City now.
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Please note that articles on MSN Money do not constitute regulated financial advice, which recommends a course of action based upon the specifics of your personal circumstances. The articles are intended to provide general personal financial information. We urge you to consult an Independent Financial Adviser (IFA) before making any important decisions about your finances. Call 0117 971 1177 for details of three IFAs in your local area.Any statement regarding financial services products and tax liability is based on legislation and tax practices as at 1 January 2003, which is, of course, subject to change.The value of any tax benefits or reliefs depends upon the individual circumstances of the investor.When investment performance is mentioned you should remember that past performance is no guarantee of future performance. Where products have an underlying investment content, in many cases the value of the investment can fall as well as rise. For with-profit based investments, there is no guarantee as to the level of bonuses that will be declared, if any. Where mortgages or secured loans are explained do remember that your home is at risk if you do not keep up repayments on a mortgage or other loan secured on it. All mortgages are subject to underwriting, status and are not available to people under the age of 18.
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I went to bed at 11pm and got up at 3:30am this morning.I am like a spring bear just after winter sleep or hibernation.
I am required to submit some papers to my son's elementary school's
children's families as a caretaker as soon as possible.I think I
should ask the other assintant caretaker about what I have to do.
I have determined when how much money I give to my son once a month.
I should not take carbohydrate and oil so much.The baby can take
what he or she needs from my body even if I quit taking foods completely because I have got so much fat within myself.Is this
a dangerous idea?
My daughter said that she had never walked hand in hand with another
boy or a man yet.
I remember her father who touched my hand when he asked me if I was OK to marry him when he had great trust in me although mostly he has never walked hand in hand with me in public.But I remember that time of his clear affection to me privately without fear or distrust.At that time I was so embarrassed with his straight affection that I was awfully bad at expressing my pleasure,but now I have grown to know how precious it is for me to be trusted by someone in peace.I am very slow to understand those matters of course.
I remember my husband have walked hand in hand with me at one night
in the street.I was so impressed by his strong handshake I remember I felt my heart warmed.I would rather prefer handshake to kissing.
I ve got sleepy now this afternoon,,,,I ve got a lot of things to
do..but
I took a nap for a couple of hours in the afternoon.
I called some other parents for help about the work I am in charge at school this year.I have started to understand a little.The mother who
was in charge last year will come to let me and the other assistant caretaker know how to do the work tomorrow afternoon.Tonight I only
have to arrange three tasks to meet them.
Curry and rice again this evening to my son.Minch salad with seaweads.
Miso soup with potato and onion.
I remember those days when my eldest brother was refusing to be out in his late days at high school.His attitude worried my mother
very much but my father dared not mind that so much.He thought of
his son's refusal to go to school as a natural state.
Ohhhh!
I did not see the program of 動物のお医者さん on TV this evening!!!
I wanted to see that.I forgot it completely for business.How stupid
of me!!!!!!!!
