First, a disclaimer. At Green Alpha Advisors we do not necessarily regard ourselves as SRI practitioners. Rather, we believe that the macroeconomic tailwinds behind green and cleantech investing at this moment in history are so great that we have focused all of our strategic efforts identifying the companies leading the sustainability revolution. As such, we are SRI only to the extent that believing in an environmentally sustainable global economy can be considered a social virtue.
Socially Responsible Investing
(SRI) is a broad term covering forms of socially conscious investing which may
incorporate environmental criteria as well as more narrowly focused approaches
that seek to uphold certain sets of moral principles. With origins tracing back
to the divestment from South Africa by institutions in response to the
apartheid, SRI champions the alignment of personal values with investment
SRI strategies usually incorporate a form of negative or positive screening during portfolio construction stage of the investment process. Negative screening seeks to avoid investments in companies that engage in undesirable activities such as manufacture of weapons, production of alcohol beverages or gambling. Positive screening seeks to select companies engaged in desirable activities such as corporate governance, stakeholder engagement and community investing.
It is our mission to offer investment vehicles constructed through a process that incorporates environmental performance at the heart of stock selection, embedding it into fundamental valuation. Rather than using either negative or positive screening, we utilize financial analysis in the tradition of Graham and Dodd which we augment with systematic appraisal of eco-efficiency factors.