Monday Morning: About these self-righteous funds…

I’m a socially irresponsible investor. So are most U.S. mutual fund investors and pension funds.

At least, that’s what those who run mutual funds which refuse to invest in the stocks of certain companies would seem to imply. They have claimed for their funds the appelation: “Socially responsible funds,” and for their clients the title: “Socially responsible” or “socially conscious investors.”

The rest of us are, I assume, socially irresponsible or socially unconscious and beyond the pale, because we (a) don’t agree with the boycotting of many of the stocks in the “socially responsible” funds, or (b) don’t want to tie our portfolio managers’ hands, or (c) don’t believe you can bring about meaningful social change by not buying the stocks of certain companies, or (d) try to make the world a better place in other, more proactive ways, e.g. giving to our favorite charities, building houses with Habitat for Humanity, or volunteering in some other way.

Who decided those who screen out certain stocks are “socially responsible?”

Probably it was the purveyors of those funds, appealing to the vanity of those who campaign against military equipment manufacturers, gun makers, cigarette makers, sporting equipment makers, makers of alcoholic beverages etc.

It’s a great marketing ploy. The not so subtle message is: If you invest in our funds you are morally superior to other investors. If you don’t, you’re morally inferior.

Personally, I believe in a strong defense. Perhaps that’s because I grew up in Australia, a country that under invested in defense before World War II and was virtually defenseless when it was bombed by the Japanese. And I’m old enough to remember my parents’ fears as the Japanese threatened.

So I do not regard investing in arms makers as socially irresponsible. In fact, those who would weaken our defenses by attempting to deny capital to military equipment makers may be socially irresponsible in my book.

no insults, please

And likewise the millions of investors like me who do not necessarily agree with the social or political agendas of those who invest in mutual funds that boycott certain funds or industries are not socially irresponsible investors.

We are just investors. Anyone who saves and provides capital to the nation’s businesses by investing is acting in a socially responsible manner.

So it peeves me that boycotting investors have claimed for themselves the “socially responsible” mantle.

Invest as your conscience directs you, but don’t proclaim moral superiority by claiming to be “socially responsible.”

And, let’s come up with another name: how about “limited” investments? Don’t like it? I’m open to suggestions.