Ethical Portfolio Management

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Ethical Portfolio Management

The term portfolio management conventionally refers to managing a portfolio of shares in publicly listed companies.

Cash or bonds

While some of the portfolio may be held in cash or bonds, the job of the portfolio manager is generally to either carry out the instructions of the investor, to advise on what to invest in or, subject to certain limits, to invest the investor's funds at his own discretion.

Ethical Portfolio

The key then to ethical portfolio investment is to ensure that the manager understands ethical investment and is suitably knowledgeable to be able to suggest companies to invest in which have appropriate socially responsible or environmental credentials.

Typically such managers will work for private client stock broking or securities firms. To find one to manage your portfolio it is worth visiting the London Stock Exchange website where there is a list of members. Alternatively recommendation from friends or family members is perhaps a better way of finding one. A third way is to contact the Ethical Investment Research Service (ERIS). Click here for our providers' pages.

• Click here for our providers' pages.

Whether your portfolio manager looks after your investments in individual companies or in ethical investment funds it is important that they pursue clear ethical policies. Companies need to behave in an ethical way to suit your requirements. The companies that make up the FTSE4Good indices represent potential target companies. FTSE has for example identified 47 companies that meet human rights criteria and 266 that have improved their environmental practices.

In the case of ethical investment funds the fund managers choose which companies to invest in and explain why they have chosen them and your portfolio manager needs to be fully conversant with these.