For the moral-conscious investor, this style of investing is perfect. Here’s what ethical investing means and one good tech stock for it.
Oct. 5, 2021
In our forward-thinking world, many investors have started to care more about what kind of companies their dollars are supporting. Gone are the days when people solely cared about making big profits, now, people want to invest in a company not only because it is a great investment, but because it is aligned with their morals.
What is ethical investing?
This style of investing is about aligning your personal beliefs and morals with the type of investments you make. If you are an ethical investor, you are likely to support companies and industries that are striving to make a positive impact in the world, like sustainable clothing and green energy businesses.
Ethical investing covers lots of different things, including sustainable investing, socially responsible investing, green investing, and environmental, social, and corporate governance (ESG) investing. They all follow the same idea of creating positive change in the world we live in and can offer great investment opportunities.
Many types of ethical investing use ESG investing variants to grade investments along what is called an ethical curve. So, if you want to build a sustainable portfolio with an environmental focus, you can look for companies with high ESG scores in the environmental category.
Generally, companies that treat their employees well and consider their environmental impact tend to have higher operational practices and are also less prone to scandals — which can save the company a lot of money, meaning higher profits for investors to benefit from.
What ethical stock should I buy?
While we have written lots of blogs about green stocks, EV companies, and solar energy firms, this is a tech stock that you might not have guessed was a great ethical investment.
Salesforce (NYSE: CRM) is customer relationship management (CRM) software that helps businesses use their clients’ information to sell more. With a leading market share, and dependable, subscription-based revenues, the company is also classed as an ethical investment.
Salesforce has a solid history of generating double-digit yearly returns for shareholders. For the third quarter, Salesforce’s sales jumped 23% year-over-year, and this money has helped it improve its ethical practices.
The tech giant is targeting 100% renewable energy by 2022. In addition, it has already achieved net-zero operational carbon emissions and created a racial equality and justice task force. Not only that, but Salesforce has dropped $16 million on equal pay initiatives.
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