The Surge in Investing by Conscience: Investment funds that take into account environmental, social and corporate governance criteria have experienced explosive growth in the last five years

The Surge in Investing by Conscience


Financial risk and return may be the main focus of most investments. But strategies with an explicit social component are growing rapidly, according to the most current data from the industry association that supports and tracks this field: US SIF — the Forum for Sustainable and Responsible Investment.


Investment funds incorporating environmental, social and corporate governance criteria in their decisions had net assets of $1 trillion in 2012, up from $202 billion in 2007, according to US SIF. That was the value of such investments in mutual funds, annuity funds, closed-end funds, exchange-traded funds, alternative investment funds and other pooled products.

Within this universe, the number of funds deemed as S.R.I.’s, or sustainable and responsible investments, surged to 720 in 2012 from 260 in 2007.

Meg Voorhes, director of research and operations at US SIF, said S.R.I.’s were growing “across a variety of asset classes like mutual funds and hedge funds starting to incorporate S.R.I. strategies while existing S.R.I.’s are also getting bigger.”

Of course, what qualifies as sustainable and responsible for one person may be objectionable for another. A fund would be included in the organization’s sustainable-and-responsible category if it incorporated a single one of 30 criteria — avoiding investment in Sudan, for example, because of objections to policies of the current government there. Another fund might appear on the list if it avoided investments in the tobacco, alcohol or pornography industries.

While $1 trillion is hardly small change, it’s a tiny fraction of total assets in investment funds in the United States. The mutual fund industry alone, for instance, had $13 trillion in net assets in 2012. Still, while most funds aren’t basing their decisions on such criteria, there are plenty of investment choices for people who do.


About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (, the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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