BUSINESSWEEK ONLINE : AUGUST 28, 2000 ISSUE
BUSINESSWEEK INVESTOR Do the Right Thing--It Pays Socially-conscious investment funds are proving attractive to women--and helping them clean up in the marketplace Want to use your pocketbook to push for social change? A strategy that involves aligning investment goals with social values is proving appealing to women. And it works: U.S. mutual funds that invest only in companies deemed socially responsible returned an average of 14.47% a year over the last three years (ending July 31) compared with 13.51% for funds that don't make such distinctions. Funds that screen out makers of weapons, alcohol, and tobacco, among others, have fared as well as their non-screened peers. Women account for just 48% of mutual-fund shareholders, but they make up about 60% of all socially conscious investors, reports the Social Investment Forum (www.socialinvest.org), a nonprofit group promoting socially responsible investing. While men make up an estimated 90% of the leadership of mutual funds, it's women who dominate the top positions at socially responsible funds. Socially responsible investing resonates with women for a variety of reasons. ''Women have more of a natural concern with the health and well-being of the community,'' says Steve Schueth, president of First Affirmative Financial Network, a financial advisory firm in Colorado Springs, Colo., that focuses on socially responsible investing. And they bring a do-good sensibility to investing that men don't always consider. ''Women don't separate how they feel about certain issues from what they want to do with their money,'' says Barbara Krumsiek, chief executive of the Calvert Group, a socially responsible fund family. BETTER INFORMED. Women also do much more research than men before they make an investment, according to the National Center for Women and Retirement Research (NCWRR). And, says Schueth, ''the better informed investors become, the more responsible they become.'' Finally, women tend to be more risk-averse than men, according to NCWRR--so they may consider companies prone to environmental investigations or poor business practices as reckless. In their view, socially conscious companies are ''fundamentally more safe and without the problems that irresponsible companies may have,'' says Sophia Collier, head of Citizens Funds, a fund group. Certainly, investing with your conscience can be a successful strategy. Much of the do-good funds' returns come from heavy investment in technology stocks. Tech companies generally pass muster on the issues that matter to socially responsible investors. A particular standout is DEM Equity Investor, which returned 90.06% for the 12 months through July. DEM, which stands for domestic emerging market, invests in companies that are controlled by women, Asians, African Americans, and Hispanics. Its top holdings are Internet companies run by Asians, such as Broadvision and I2 Technologies. The Women's Equity Mutual Fund invests in companies that promote women, both socially and economically, in the workplace. Its top holdings are Microsoft, Lucent Technologies, and Johnson & Johnson. What's great about socially responsible investing is that you don't have to sacrifice your values in order to get good returns. For more on social investing, or to join a discussion in our forum, see hers.online at www.businessweek.com/investor/ Questions? Comments? E-mail hers@businessweek.com or fax (212) 512-2538 By TODDI GUTNER _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ BACK TO TOP					RELATED ITEMS Do the Right Thing--It Pays TABLE: Social Investing Makes Sense INTERACT E-Mail to Business Week Online

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