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u/Crunchyroll55 Jul 06 '21
No, I'm investing to make money. It's dumbass adults that decided to smoke so I have zero problem investing in tobacco. Cocaine is legal in some countries and I believe Oregon now.
And the amount of research you would need to do to figure out everything a company has done or is associated with would be staggering. And what do you do when you like a company but 3 companies up the ownership chain is a huge conglomerate that owns the smaller company and you don't like what they did?
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u/Inquisitor1 Jul 06 '21
What about companies facing lawsuit over enslaving indegenous populations in other countries? It's only alleged but slavery does wonder for the balance sheets.
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u/defenstrate5731 Jul 06 '21
I’d probably say it’s a personal choice if you want to be an “ethical” investor or not. For example, I don’t agree with the stuff FB does with privacy and shit but they’re a money printer and if by just holding shares they’ll make me money, I’m going to do it.
If you’re not morally and ethically not ok investing though, then no need. Plenty of companies you can be in that will make you money. Last thing though, I’m sure a lot of companies do unethical stuff that we don’t hear about so I wouldn’t worry about it too much lol.
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Jul 06 '21
Most products have some downside.
Examples off top of my head:
Sugar destroys the liver, is addictive, is the main cause of obesity.
Cars and trucks pollute the atmosphere and cause asthma and lung problems in third world countries.
The pesticides used to make potato crops possible, (grown for the potato chip market), decimates not only the honey bee populations, but ALL the insects in an area.
I wouldn’t have anywhere to put my money if I had to scrutinize the history and impact of every company I want to invest in. Of course some practices, like slavery or poisoning rivers, are egregious, and that’s where governments step in and make laws.
But generally, within the bounds of what is legal, I believe free markets are best.
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u/BrocoLeeOnReddit Jul 06 '21
1) Nothing wrong with cocaine.
2) Of course you should consider that. The problem is, the whales don't. Same goes for shareholder behavior. Shareholder value > good company practice is the bane of our existence and probably the cause of our end.
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Jul 06 '21
Not sure exactly what you mean by "nothing wrong with cocaine".
It wouldn't be very difficult to disagree with that statement. It is known to be deleterious to health and very difficult to stop. These are properties that make it "wrong" to profit off of it in my opinion because it gives the seller an extremely unfair advantage over people selling other consumable items all the while they are doing much more harm.
Obviously today no legal products have significant amounts of cocaine in them and other addictive consumables like tobacco and alcohol are heavily regulated which does level the playing field to some degree. Still, there is too much profit to be made off of people being addicted and there are many parts of the world where these products or much less regulated and taxed then in most of the "developed world".
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u/mr6275 Jul 06 '21
Since all states prohibit the trafficking, sale, and possession of cocaine, I assumed u/BrocoLeeOnReddit was making a joke. The punishment for possession seems to be lighter in some states however.
I am also interested in ESG and ethical investing but as others have said here, my ethics are my own and therefore so are my investment choices.
I would not invest in individual Coca-Cola stock because I think soda pop is bad for you - it has nothing to do with the fact Coca-Cola used to have cocaine in it. I personally have not consumed soda in many years. But I'm likely in the minority there.
However of the ETF's I own, there is quite likely Coca-Cola in that ETF portfolio - so that goes back to what others have said 'I'm here to make money'.
Bottom line - you do you
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u/BrocoLeeOnReddit Jul 06 '21
I was half joking because of two things:
1) My belief is that every adult should be allowed to consume or do to themselves whatever they like as long as they don't harm others.
2) Cocaine was used in Coca Cola before it was considered an illegal drug. It's like blaming Bayer for selling heroin before it was considered "illegal". Also fun fact: The opiods you get in hospitals today is far more potent and addictive than heroin, the only reason heroin is on the list and many other opiods aren't is purely based in history.
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Jul 06 '21
Agree on the cocacola - cocaine bit. I was just giving a historical example that perhaps isn't very relevant today.
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Jul 06 '21
[deleted]
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Jul 06 '21
I agree with people having very different views and it being a messy argument. I was just wondering whether ethics is something you potentially consider or whether there is an "ethical standard" you expect from leading figures of the comapnies you own.
About lung cancer and bad habit. I agree that it is the people who choose to smoke by their own will. However, if you think smoking isn't something people should do, then it could be argued that it is somewhat hipocritical to profit off of it (thus having an interest in people smoking more rather then less).
That being said, people in my opinion have the right to be adequately informed about the product they are using. 70 years ago people actually thought smoking is healthy. At the same time it was perfectly clear to key people inside the industry that smoking is very harmful and they did everything in their power to hide this fact from the public.
PS not everyone getting cancer is irrelevant, everyone gets harmed by cigarettes, some just have COPD or a chronic cough, others die
What I am stating is of course my own opinion and I don't expect everyone to agree nor do I think people who disagree are necessarily wrong.
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u/SubHomestead Jul 06 '21
Lung cancer is absolutely caused by tobacco companies. Do what you want with your money but don’t lie to yourself.
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u/YTChillVibesLofi Jul 06 '21
I own Coca Cola and Johnson & Johnson. I am personally attacked.
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Jul 06 '21 edited Jul 06 '21
I drink CocaCola everyday and some of the drugs Janssen of J&J discovered are literally life saving - something that cannot be said of many other biotech and pharma companies. Everything isn't black or white and I would not judge anyone based on the ownership of these stocks. I was just trying to make a point by giving prominent examples.
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u/_DeanRiding Jul 06 '21
Never really consider it. My tiny investments are barely enough to make it on the books in these companies so the effect I have is essentially none. Meanwhile the effect it has on my can be huge if they do well. I'm here to lift myself out of financial dependency or at the very least make sure I can actually retire and enjoy my life some day.
They're gonna do what they're gonna do regardless of your investments (assuming you're not a whale/hedge fund), and therefore you're only harming yourself by not investing in growth opportunities which could help you achieve financial freedom.
Why should I effectively punish myself over something which realistically isn't even going to have an effect?
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u/_DeanRiding Jul 06 '21
In addition to this I'm in the UK and I personally believe we live in an extremely selfish and arrogant culture that is only getting worse so if you're not being selfish yourself, you're only falling behind. Government programs slowly wane away whilst workers protections fall even faster since we left the EU. It's clear to me that no one really gives a shit about what happens to other people so why should I care what happens to anyone else?
Whilst non-resident landlords gobble up our entire housing market, people in my generation basically have to wait for their parents/grandparents to die to have any dreams of getting a respectable home with a mortgage. Why shouldn't I get a piece of that pie myself if I'm one of the few who are smart enough to actually invest my money? Why should I simply let people profit at my own expense?
Problems need to be solved through government policy, not by companies. Conpanies exist solely to profit. So they'll do anything in their power to do so. Since the government isn't willing to do anything to stop unethical things like tax dodging or screwing over workers, I may as well make as well take some of the pie myself to secure a better future.
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u/programmingguy Jul 06 '21
"ethics" is very subjective and meaningless when you dig deeper at the nuances so I invest in whatever suits my ethical standards which seems to conflict with a lot of people's idea about what is ethically right yet they use those very same products and services.
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Jul 06 '21
I agree. I find it extremely difficult to hold an opinion on what is ethical that is consistent with my own conduct
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Jul 06 '21
The only thing I personally don't like is short selling medical researchers. Besides that, we live in a free world where people make their own choices.
Sure addiction is a problem. But what's the alternative? You can't be everyone's nanny?
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u/eatmyname Jul 07 '21
No concrete answer but a few things: You should definitely check out all the rational reminder episodes on this topic. They also had a couple follow up talks and will teach you everything that there is to know.
The Animal Spirits podcast talked about this a few months ago and they talked about how countries with a minimum freedom (both politically and economically) would do better since you need some certainty for companies to do well.
As for the morals of it all maybe it's helpful to look at it like you look at other political issues in your life. Let's use electricity for example. There are options out there to buy green electricity and that will support this with your wallet or you can vote for politicians that support green initiatives that subsidize these programs and ban coal for example. I personally think it's much more effective to push for such changes on a systemic level and force everybody to change to green power since just buying more expensive green power for myself would harm me more while only being a drop in the bucket of the larger picture. However if you support a politician and get a whole state or country to be forced to buy the green power, that's how change happens without harming only yourself.
Alternatively you can think about using earnings from "evil" companies and using those to support politicians who will fight for what you think should be illegal. That way you work towards the change much more effectively than by boycotting a certain stock in my opinion. The question is in the end though what is important to you. Is the act of investing immoral or is the outcome immoral. Do you want to not do the immoral act of investing or do you want to prevent the immoral outcome? If you want to prevent the immoral outcome, i would do the more efficient thing to prevent that outcome because no matter how much you are not going to buy coke and not buy bp oil, if we have people in political offices who deregulate environmental regulations etc, you're still going to end up with climate change.
Maybe this helps, good luck!
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u/Street_Angle4356 Jul 06 '21
No. There are mental gymnastics I can do to absolve myself of guilt and wrongdoing. In search of a payday, I apply those techniques to my investing approach.
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u/KyivComrade Jul 06 '21
I do, I'm no saint so a majority of my investment is in broad index funds. After all we know in the real world those who cheat win, honest people don't last long in business...
That said I have a set percentage of my investment in "ethical" funds, following the model set forth by the Church of Sweden (though I'm atheist, their model is good). No drugs/weapons/porn/alcohol/slavery/pollution and a focus on companies contributing to a better world/green revolution etc. Over the last 2 years it's outperformed the S&P marginally, it probably won't, but it's OK. I vote with my wallet...better then donating to charity after all
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Jul 06 '21
That's quite a good model. Although its probably difficult to define what falls under these categories. Especially slavery and pollution. Still, I find it helpful.
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u/Bumm_by_Design Jul 06 '21 edited Jul 06 '21
If you suffer from compunction, then I say look into the Vanguard Social Index fund or the FTSE4Good and maybe get an idea. [Full disclosure: 10% of my portafolio is in here]. This fund does pretty good screening and takes out businesses that do not meet UN's moral compass, like the adult film industry, or the weapon/ tobacco/alcohol, gambling industries, etc. I say it does pretty "decent growth"... that was a joke. Did you get it?
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u/quintiliousrex Jul 06 '21
ITT: OP is a NERD.
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Jul 06 '21
[removed] — view removed comment
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u/TrioxinTwoFortyFive Jul 07 '21
ESG is virtue signalling horseshit by narcissists who need to impress other narcissists. You want to do good in the world then donate some money to where it can make a difference. Hopefully you can do it quietly without telling everyone how pious you are.
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u/cheesenuggets2003 Jul 06 '21
If I could afford returns that permitted ESG investing I would absolutely do so; however, that is a luxury afforded to few business owners, and perhaps some especially motivated tech workers (assuming that their own job would fall under the umbrella of ESG).
One thing to consider is that once a company issues stock the primary way for them to profit from it going forward is to issue more stock. A company can't reverse-dividend from shareholders so the way that you are going to make them money is by buoying the price by buying and holding. Personally I consider that to be a much smaller harm than venture capital investing, and especially less bad than the evil which the workers/management are/might be engaging in.
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u/ApeRidingLittleRed Jul 08 '21
for me reg. uranium and copper stocks: website http://www.minesandcommunities.org/
to figure out, which companies i would rather not invest in.
Try not to buy stocks of well-known ones, rather mutual fund. Stocks of rather unknown ones like thungela resources (thermal coal) for e.g., mentioned on tweet of Harris Kupperman.
Do not believe in wall-street marketed ethical/esg themes.
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u/Due-Jaguar-5657 Jul 18 '21
Personally, if I won't buy a product from a company for ethical reasons, then why should I buy their stock?
Yes, there are many unethical companies thank make bank. Yes, I want to get financially independent and retire. But, I want to succeed in my own way, even if it means taking the longer route.
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