In my latest MoneySense column, I explored whether socially responsible investing is compatible with the Couch Potato strategy. If you’re not familiar with SRI, it’s about finding investments compatible with your ethics, which often means avoiding so-called sin stocks and companies with poor environmental records. It may also involve selecting investments that have a positive social impact.
My main source for that column was Timothy Nash, president of Strategic Sustainable Investments, a company that helps institutions and individuals create portfolios aligned with their values. Tim also has a blog called The Sustainable Economist and recently wrote a post called The Organic Couch Potato, where he shared his ETF suggestions.
Tim is a thoughtful, articulate advocate for SRI and I thought readers would like to hear more from him, so here’s an excerpt from our interview. I’ll run another in a few days, and next week I’ll go into more detail about specific investment products that combine passive investing with SRI principles.
In many ways passive investing and SRI seem incompatible. One of the fundamental ideas behind indexing is that you don’t pick individual companies.