THE TOOLS WE USE TO SUPPORT YOU

We understand that every client will have different attitudes towards investing and whether or not they want to take account of social, ethical, environmental or religious issues during the investment process.

Milton Friedman's Theory

The Economist Milton Friedman from the Chicago School of Economics took the view that taking an ethical or social stance on investments may be inefficient, and the best approach to handling finance is to seek the maximum return. This approach was pioneered in his article "The Social Responsibility of Business Is to Increase Its Profits" featured in the New York Times in 1970.

We have clients who have followed this path and once they have achieved their financial goals have sought to use their wealth for social, ethical or environmental benefit by making:

• direct high impact social investments or

• donations to charities whose objects provide a good match to their concerns or

• a change to their Wills to create a charity or make a bequest to charity whose objects provide a good match to their concerns

We can support clients seeking to follow this approach thanks to the Investing for Good (www.investingforgood.org) service that we use which includes a database of all UK charities and non-retail social investments. We can identify those charities or social investments that represent a good ethical match to our client's values.

Jed Emerson's Theory

In contrast Jed Emerson of the Generation Foundation developed the blended value approach. This is the view that companies do not have to make a compromise between achieving a social output and economic returns. (www.blendedvalue.org)

The assertion that retail ethical investments will only achieve at best the market rate of return has now been shown up as a myth. In the calendar year 2006 the top performing investment fund in the UK All Companies sector was an ethically screened investment fund, which beat over 300 other funds.

We have clients who have taken this route and seek to integrate their personal values with their financial planning so that their investments provide a good match to their concerns on social, ethical, environmental and religious issues.

We can support clients seeking to follow this approach thanks to the ethical screening services available from the Ethical Investment Research Services (www.eiris.org) and Ethical Screening (www.ethicalscreening.co.uk) which allow us to screen individual company shares and corporate bonds as well as investment funds available through ISAs, pensions etc.

Fund Platforms, Wraps and Stockbroker Portfolios

Whichever approach is chosen, or possibly a combination of the two, we can ensure clients meet their aims by using the above services and investing intelligently.

Cofunds
This is a funds platform (also known as fund supermarket) that gives us access to a wide variety of investment funds whilst minimising cost and paperwork. It applies to investments in unit trusts and open-ended investment companies (OEICs) which can be via Individual Savings Accounts (ISAs) or Personal Equity Plans (PEPs). In particular Cofunds provides access to over 30 different ethically screened investment funds (covering both equities and corporate bonds) from 17 different asset management companies.

Wrap service
A wrap service is the administration of your self-investing personal pension (SIPP), PEPs, ISAs, unit trusts, OEICs and investment bond by one service provider. Wraps can be viewed as being like a funds platform with more bells and whistles, it extends to pensions and investment bonds and provides 24 hour online access to customers and advisers, with the capability for all transactions to be arranged electronically. All said and done wraps are generally more expensive than standard retail terms by around 0.3% per annum, so clients would really need to strongly value the 24 hour access to justify the cost.

Stockbroker portfolio
For investments of £200,000 or more the retail terms offered by unit trusts and OEICs become rather expensive and the terms associated with a bespoke stockbroker service become much more attractive. Through several years of working together we have developed an excellent relationship with the local branch of a major stockbroking firm. The service offered can take account of ethical screening requirements and we have negotiated very competitive terms as follows:

Conclusion

By having access to such a variety of tools and operating on a fee basis we can provide a more comprehensive service that offers excellent value for money and deals with all possible needs associated with a client's personal values.

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