Socially Reaponsible Investing

Question 1

Explain difference between positive and negative screening for socially responsible investing (2)

Answer 1

• positive screening invests in companies which meet laid down criteria
• negative avoids those that don’t

Question 2

Four drawbacks of socially responsible investing (4)

Answer 2

• less diversification
• more expensive
• less research available
• higher risk
• screening rules out growth/income