4 Leading Sustainable Responsible Investing (SRI) Funds

June 18, 2015

SRIfundsSustainable responsible investing (SRI) funds began in the 1970s, but they’ve grown tremendously in the last decade. In 2005, there were around 200 SRI funds, but by 2014 there were more than 900, according to the Forum for Sustainable Responsible Investment (US SIF).

Today, many of the largest fund companies like Vanguard and iShares offer SRI funds, and SRI funds cover many areas of the market and the globe.

You can invest in domestic SRI funds and foreign SRI funds. You can invest in SRI ETFs and funds that track SRI indexes or actively managed SRI funds. You can find sector SRI funds and SRI funds that are diversified across many different sectors or regions.

In FundX President Janet Brown’s Forbes article, she shared four diversified SRI funds that are doing well now, including:

1. Brown Advisory Sustainable Growth (BAWAX)

BAWAX was one of the top funds in the June 2015 issue of NoLoad FundX. It invests in companies with a strong environmental focus. These companies may produce a product that its environmentally sound or they may have environmentally friendly business practices. Tech companies tend to fit the bill, and a third of the fund’s portfolio is in technology stocks.

2. Ariel Fund (ARGFX)

Most top diversified funds have been focused on large-cap companies, but Ariel Fund is one exception. ARGFX has brought in strong returns by investing in a select group of small- and mid-cap companies that its managers believe are undervalued. ARGFX includes companies that have good diversity, labor and environmental practices, and the fund avoids investing in companies involved in tobacco or handguns.

3. Vanguard FTSE Social Index Fund (VFTSX)

VFTSX is a leading SRI index fund. It tracks the FTSE4Good U.S. Index, which includes more than 400 U.S. companies that have a good record on the environment, human rights, labor and climate change. It excludes tobacco producers or companies involved in weapons, including nuclear weapons. About 20% of the index is in tech stocks and another 20% is in health care–two of this year’s best performing sectors.

4. Parnassus Endeavor (PARWX)

Newly added to NoLoad FundX, Parnassus Endeavor focuses particularly on large U.S. companies with strong workplace policies, including Google, Whole Foods and American Express. Google has been the top company on Fortune’s 100 Best Companies to Work For for six straight years. Tech companies make up a bulk of the fund’s portfolio (more than 40%). It has no exposure to alcohol, tobacco, gambling, weapons or fossil fuel companies.

Learn more about these funds in Janet’s Forbes article, How to Easily Invest Sustainably and Responsibly.

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