What type of investment approach is focused on ethical and sustainable practices?

The focus of socially responsible investing (SRI) is on integrating ethical and sustainable practices into investment decisions. Investors who choose this approach actively seek out companies that not only provide financial returns but also contribute positively to society and the environment. SRI investors consider factors such as corporate governance, environmental impact, labor relations, and human rights when selecting investments. This method reflects a commitment to aligning investment strategies with personal beliefs and values, prioritizing ethical considerations alongside financial performance.

Other investment strategies, such as aggressive growth investing and speculative trading, generally prioritize maximizing financial returns, often without regard for ethical implications. Traditional value investing focuses on identifying undervalued stocks based on their fundamental value, which may not necessarily consider ethical practices. Thus, socially responsible investing stands out as a distinct approach that merges financial goals with a commitment to ethical and sustainable principles.