One decision I made earlier this year that I’m happy with is moving some of my investments into the MSCI KLD 400 Social Index. In a nutshell, it’s an exchange traded fund similar to S&P 500 index funds with a key exception. It parses out companies that are significantly involved in the following industries: alcohol, tobacco, firearms, nuclear power, military weapons, and gambling.
Personally, I feel better knowing that I’ve at least made an attempt to not build my nest egg through death, destruction, and exploitation.
Also interesting. Economist James A Brander in The Journal of Business Ethics found that the companies meeting the criteria for this fund tend to have somewhat more sane executive compensation packages (12% lower on average) relative to the executives in the death, destruction, and exploitation industries.
Many Americans don’t have the luxury of choosing ethical funds for investments due to the limited choices offered by their 401k plans (assuming they’re in a position where they can invest at all). But, if you have money with more flexibility (ex. IRA, Roth IRA, Rollover IRA or money in non-retirement investments), know that there are options available worth checking out such as this.