Amy Domini on the Big Picture TV
by Justin Thomas, Virginia on 06. 2.05
This time it's Amy Domini who gets her "five minutes of fame" as she is featured on Big Picture TV. Amy is Founder and CEO of Domini Social Investments and a pioneer in the field of socially responsible investing (SRI). She is the author of several books including "Socially Responsible Investing: Making a Difference and Making Money" (2001). She was recently named by Time magazine as one of the 100 most influential leaders in the world.
Amy Domini talks about the origins of socially responsible investment. She looks at the growth in SRI funds in recent years and examines what ethical investing has come to mean. She explains that it is the analysis of the negative or positive effects on the stakeholder community that largely shapes ethical investment.
The key element of any SRI index is whether it is based on a "positive screen" (including companies recognized for fulfilling promises and meeting peformance metrics); or, conversely, it is based on a "negative screen" that keeps out the "bad guys". The latter is far easier to do and very subjective. Negative screening always comes down to "I don't like them because they "_____"".Everyone has s different definition of what is and is not acceptable and in what context exceptions should be made.
Example: alcohol selling. If your religion prohibits alcohol for you, does that mean its a good negative screen criteria for everyone else? THe positive screen is the one that takes some effort to design and use but is of greatest value. Continued example for positive screened index fund: the alcohol, when sold, is made with continous improvements in energy efficiency and with reduced VOC emissions per Kg produced and delivered. The negative screen is value judgement laden; the latter based on hard niumbers and benefits every resident of the planet.