For the price of oil

February 19, 2008 11:00 pm

By Kelley Atherton

Triplicate staff writer

A barrel of crude oil has surpassed $100 as gas prices continue to teeter around $3.50 a gallon.

The Earth's climate is ever-changing and green investments are gaining popularity.

Are there any other better reasons to choose a socially responsible investing (SRI) fund? It's not just about protecting the environment either. SRI addresses unfair trade practices, human and animal rights issues and violence that has ensued in the name of oil, diamonds and other hot commodities.

Most people invest to increase their wealth or save for a major life event, such as a college fund or retirement. The choice remains, however, which is more important: morals or wealth?

It's not that easy, though. SRI goes against the grain of winning Wall Street stocks. Financial advisors shy away from SRI because it yields low returns. SRI involves taking a risk. Granted dabbling in the stock market is always a risk, but this risk is different. It could just be a fad.

Calvert, a Washington, D.C.-based asset management company, defines SRI as a strategy that integrates social or environmental ethos into financial analysis. Corporations must follow a set of criteria based on governance ethics, workplace and product safety, the environment, international human rights, indigenous people's rights and community relations.

Jane Bryant Quinn, the personal finance columnist for the Washington Post, explained that SRI defines people like their car does.

"A Chevy Impala will get you across town," she wrote. "So will a Toyota Prius, a Porsche and a Hummer. Whichever one you drive, you are hanging a flashing neon sign on your soul. It's that way with SRI investing, too."

It's not a hard-and-fast rule that SRI yields low returns, Quinn explained. SRI has seen its share of good and bad days, just like traditional stocks. It depends on the market, and currently U.S. companies are moving toward alternative energy investments.

Most investors will tell their clients to diversify their portfolios and not favor one industry. Broad market indexes cover most well-performing stocks and there is something to be said for following their lead while picking out some green investments.

A simple Google search for "socially responsible investing" brings 127,000 hits. Pick one with a solid performance history or speak with a financial advisor.

A report by Anne Moore Odell for Social Funds, a personal finance Web site devoted to SRI, stated that socially responsibly mutual funds are on the rise.

"SRI funds are looking internationally to invest with the best companies the world over," Odell wrote. "This international approach diversifies portfolios and profits from the rise of new markets."

Social Funds offers a rundown of funds:

•Calvert's Global Alternative Energy Fund has more than $120 million in assets and Calvert International Opportunities Fund invests in small and mid-cap companies in 25 countries.

•Winslow Green Solutions Fund invests in mid-cap domestic and international companies that pass Winslow's green test.

•Spectra Green Fund, a growth fund with a broad definition of green companies, including Apple and Microsoft.

•Gabelli SRI Fund invests in domestic companies that pass its social and environmental screens

Odell offers a nugget to think about: Socially responsible companies tend to think about the future beyond the next quarter.

"Looking at companies through a SRI lens actually offers investors a valuable tool to identify how companies are posed to deal with risks and capitalize on opportunities."

Reach Kelley Atherton at This e-mail address is being protected from spam bots, you need JavaScript enabled to view it