More than ever, consumers are looking for the companies they support to have a social impact in their communities.
Today’s consumers believe that companies can make a positive difference in their communities, while also making a profit. They also hold the belief that the companies they choose should reflect their values.
That’s why many are beginning to look toward SRI (socially-responsible investing) practices for their personal investments.
What is SRI?
The goal of sustainable, responsible and impact (SRI) investing is to contribute funds toward positive social change and receive financial returns as a result.
While socially responsible investing focuses on maximizing financial returns, impact investing can be a bit more flexible in the expected returns, and impact investors may accept lower returns to produce the maximum impact to the causes they believe in.
The city of Los Angeles (and surrounding areas) are a hotbed for SRI, and its core tenets are practiced by many businesses, non-profits and organizations.
Let’s take a look at why LA ranks highly in social responsibility – and how it might affect your investing.
What Makes LA Socially Responsible?
LA is a trend-setting city; the main producer of arts and entertainment, and by default, a de facto world leader. What comes from California today becomes culture tomorrow.
a.) There’s a huge premium on health – as an actor, your appearance helps pay your bills.
This attitude attaches itself to all matters regarding health, including the air we breathe, and the water we use.
b.) A devotion to the idea of peace. Maybe it’s due to the diverse cultural groups in California. Or perhaps it’s left over from the ‘hippie’ days of the 60s and 70s. But the idea that everyone should get along is generally a strong one in Los Angeles. And doesn’t bode well for weapons manufacturers, per se.
c.) There’s a large framework of grassroots volunteers, activists and change-makers who not only engage in things like advocacy, community organization and coalition building, but who are working to envision a city in which social impact is more than a trend, and something that’s woven into the
Corporate Social Responsibility:
Social impact in Los Angeles starts at the individual level, with passion projects taking off to enact real world change. Many retail and production companies in the Los Angeles area start projects out of an ethical theory in which individuals are accountable for fulfilling their civic duty, and the actions of an individual must benefit the whole of society. In this way, there must be a balance between economic growth and the welfare of society and the environment.
Many companies and organizations in L.A. engage in innovative business practices, which help contribute to socially-conscious efforts such as reduced energy use + emissions.
-Upcycling or recycling goods, such as shipping containers or used clothing, to make and sell new solutions.
-‘Green’ startups are everywhere you look in Venice’s ‘Silicon Beach’ and beyond. A number of electric vehicle manufacturers and suppliers are located here as well. The solar industry is also taking note of California’s abundant sunshine.
-Lots of organizations in L.A. seek to improve the human condition, by working to solve challenges such as lowering prescription drug costs, making organic foods accessible and more.
This is only a small dose of what the socially conscious in LA are doing to change their communities and the world for the better, and what makes SRI in Los Angeles so important is the potential to shape these business models into globally accessible concepts.
How Does SRI in Los Angeles Operate?
Some of the top socially conscious investors in the world have focused their attention on Los Angeles-based social impact investments, with large foundations, institutional investors and pension funds all leading the charge. Plus, it’s easier than ever for investors to contribute early to startups with promise, and there are many resources making SRI in LA more viable than ever.
Los Angeles is also home to the biggest SRI conference in the country, with SRI Los Angeles coming at a future rescheduled date. The mission of the conference is for any potential investor to “learn from asset managers who are harnessing the power of capital to address social, environmental, and cultural challenges while generating financial return”.
With so many LA-based organizations focusing in on changing the status quo in Los Angeles and the world, it should come as no surprise that SRI investing in LA is a quickly growing area. It’s only trending upward, and shows great potential to bring forward more companies, individuals and organizations that can help effect change in the world.
How Signet Can Help:
It is our mission to provide investment resources and strategies to clients and financial institutions helping them develop a greater knowledge and passion for sustainable, responsible and impact investments. Let us help you find your mark with our experience.
The return of Environmental, social, and governance investing may be lower than if the adviser made decisions based solely on investment considerations.
No strategy assures success or protects against loss.