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BIS Cosgrove Accountants Gold Coast & Brisbane

Is Your Superfund Ethical?: Socially Conscious Financial Planning

ethical investing for SMSFs

When it comes to investments, you may think that the best thing to do is keep your options as open as possible and not disqualify any industry or company, even if you don’t agree with their business practices. No one wants to miss out on a great investment opportunity. You may be surprised to learn that you can increase wealth and only invest in ethical companies you believe in.

The Effects of Ethical Investments

If you hold a strong belief in a cause, whether it is the environment, people, or something else, you will most likely feel a need to live accordingly. Your ethics can also be applied to how you invest. When you invest in a company or industry that you feel good about, it can have a positive impact on you personally as well as your enthusiasm for the investment.

Putting money where your morals are is also a really good way to help further the cause by strengthening it through financial backing. You may even see a change on a local, national, or global level thanks to people like you who invest consciously.

The downside is that, should you find out one of your investments wasn’t as in line with your cause or belief as you thought it was, it can be a big disappointment.

Is My SMSF Ethical?

There are several factors that go into determining if your SMSF is in tune with your ethics and beliefs. First, you need to determine where you draw the line. Do you have any flexibility when it comes to investments? For example, are you ok with 95% of the investment matching your expectations even if 5% involves some aspect you do not approve of? You must have a set of benchmarks in place to determine if you are ok with your SMSF’s investment choices.

There has been controversy in the past when ethical SMSFs invested in companies that many did not agree with, like buying stock in oil companies that operate in conflict with environmental concerns. You can’t predict the future, but with enough information, you can lower the risk of investing in an SMSF that goes against your beliefs.

The best way to begin the process is to do your own research and talk to an expert. This will help you gain a better understanding of ethical and unethical practices and how they impact communities, the environment, or whatever group you are interested in protecting or assisting.

It can really help to have an unbiased third party on your side when researching your SMSF. Make the socially responsible decisions for your funds and your future by contacting Brian and the team at BIS Cosgrove.