3.8. Ethical Investment

Question 1

What is ethical investment?

Answer 1

When a person, company or group only invests in areas that are considered socially responsible

Question 2

What are generally avoided by ethical investors?

Answer 2

Companies that cause environmental or humanitarian harm

Question 3

What has happened to ethical investment since the 1990s?

Answer 3

Amount of ethical investment by US companies almost tripled between 2005 and 2016

Question 4

Why don’t governments want to invest in tobacco, firearms or polluting energy companies?

Answer 4

Governments don’t want to be associated with promoting or being seen to be ok with these products

Question 5

Why do investors make a choice based on a company’s activities?

Answer 5

Governments are more likely to invest in more environmental companies that are more green, transparent companies

Question 6

Why do companies change their products to suit more people?

Answer 6

• More sustainable = more ethical investment
• Companies are aware of social and environmental concerns -> companies are more likely to invest in companies that are more ethical as they want to be associated with their values

Question 7

How do socially responsible choices/ personal principles and beliefs contribute to ethical investments?

Answer 7

Consumers change choices companies make so if consumers stop buying, companies will change the product - mat make it more sustainable/ ethical

Question 8

What is greenwashing?

Answer 8

Unjustified and misleading claims from brands that their products are more environmentally friendly than they really are