Sometimes it’s just as important to know what you don’t invest in as what you do. There are certain lines of business that we believe are fundamentally misaligned with our goals of universal human dignity and ecological sustainability. These exclusionary standards are applied across all our mutual funds:
Our thresholds for exclusion are generally determined by such factors as percentage of revenues, magnitude of involvement (market leadership), or ownership. Companies that don’t meet these thresholds may still be excluded, but are evaluated case-by-case, based on the absolute size of their involvement, the trend of their involvement, and the prominence of their role in their subindustry, along with the company’s overall environmental and social record.
The capital markets are highly effective mechanisms for raising funds for a wide variety of products and services, but we do not want to invest in products that have the potential to cause incalculable harm. We therefore exclude corporations substantially involved in weapons and civilian firearms production and nuclear weapons production, as well as the owners of nuclear power plants.
We exclude companies in the energy sector involved in oil and natural gas exploration and production, coal and uranium mining, oil and gas storage, transportation, refining, and related service providers. We also do not approve electric utility companies that have either announced plans for new construction of coal-fired power plants or started new construction after the Paris Agreement was adopted in 2015.
We exclude for-profit prisons and immigration detention centers due to the significant civil and human rights concerns that occur as a result of their business models, particularly for marginalized communities.
We exclude companies that are significant manufacturers of alcoholic beverages or tobacco, or significant providers of gambling goods and services. For these companies, effective marketing often means exploiting customers’ addictions to these products or ignorance of their risks. This is not a business model we believe our investors wish to support.