# SRI - Socially Responsible Investment

### Key information

*SRI refers to investment approaches that apply social and environmental criteria when evaluating companies.*

**How it works:**

* Investors will create a scoring system based on criteria relating to social impact
* Investments are usually made considering the [environmental, social and governance (ESG)](https://app.gitbook.com/o/-McKGq_a1TOXsR8F_eHk/s/-MifNfxt8QM_rrrKIbB5/~/changes/wwdpeJwVqyqRFM2Pi49y/interviews/lessons/oikos-syllabus/what-is-esg) aspects of a company.
* Excluded companies are dictated by the goals of the investor, some may want to avoid weapons companies where as others could want to support companies that do not pollute excessively.

#### **Sustainable Finance, SRI, ESG, etc. is not just a Trend**

* $12 trillion market in 2019, or about $1 of every $4 investing in SRI 
* UN’s Principles for Responsible Investment (PRI) has >3,000 signatories & $90 trillion 
* Green bond & loan issuance $360 billion globally in 2019 
* BlackRock predicts ESG funds to rise >$400 billion over the next ten years 
* Unique tools are being created $25 million water bond for Washington, D.C. in 2016 
* 90% of millennials want to invest retirement savings sustainably ([Morgan Stanley](https://www.morganstanley.com/ideas/sustainable-socially-responsible-investing-millennials-drive-growth)) 
* 75% of savers say they want SRI choices ([Natixis](https://www.im.natixis.com/us/esg-investing)) 
* 75% of millennials consider company values ([Sustainable Brands](https://sustainablebrands.com/read/organizational-change/3-4-of-millennials-would-take-a-pay-cut-to-work-for-a-socially-responsible-company), [Nielson](https://www.nielsen.com/us/en/insights/news/2018/was-2018-the-year-of-the-influential-sustainable-consumer.html))

Source: [HBR: The State of Socially Responsible Investing](https://hbr.org/2019/01/the-state-of-socially-responsible-investing)

![Source: USSIF](https://lh6.googleusercontent.com/1EoOwfMv7RmSrut4v6wnw9u5kORkDNwGBIBBONdRqe2z6ATQ_r1T6UNlZiarC5RCiWAQreELEhkpjyeC2SxeJakSrGKAb6CiZXr3iUfAR6LnOc8S3JgIFs_GqCZ7YJJ4SwyNEDb7p1MuqQvSIiHvNRslig)

### Our favourite video

{% embed url="<https://www.youtube.com/watch?ab_channel=JuliusBaer&v=L0DL1A1aG2c>" %}
Source: Julius Baer
{% endembed %}

### If you want more

{% embed url="<https://www.investopedia.com/terms/s/sri.asp>" %}


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