Morals and investing. This is getting deep. Once again, good old Steve at Kapitalust has provoked me to writing a longer reply to a topic he recently posted about – ethics/morals and investing. A fascinating discussion ensued is still taking place over at Kapitalust HQ. Our wonderful Belgian buddy, No More Waffles, has also recently discussed the morality of investing in tobacco companies, in his analysis of British American Tobacco.
This is really turning into an intriguing and absorbing discussion. I like what NMW and Potato both said. There is a very fine line indeed between what people are willing to do, and what they’re not; equally, can we really have an impact at the share purchase level?
Our World is Imperfect
I do much prefer to invest in individual companies that I research myself. But as I mentioned in the discussion, we live in an imperfect world. It is sad that there are companies out there which are damaging both society and the planet. But we are not perfect either. I am sure the people running those companies could point the finger at ourselves too. We have all made mistakes. So how do we balance out our morals and investing?
We cannot live as hermits. If we want to engage in the world, in society, in nature, then we will affect these things somewhat. It is inevitable. We walk out of our house, through a spider web, thus destroying it. We tread on ants across the yard, thus killing them, on our way to our car, which is polluting the atmosphere (even electric cars do, where does the electricity come from that powers them?!). We are imperfect beings interacting in an imperfect world, in an imperfect society, in an imperfect economy. Therefore, whichever companies we invest in will by default, be imperfect. We need to remember this when worrying about morals and investing.
In Every Deed, there is a Seed
But the whole point of this discussion is, I think, that we are not automatons, we are not robots. We have emotions and morals and ethics and ways of living. We may all be slightly, or even vastly, different in these things, but we still have them. And these things can (and maybe should?) affect every decision we make. Someone once said ‘in every deed, there is a seed’, so perhaps morals and investing really ought to go hand in hand?
Following the Moral Compass
For me, I do not like to go against my conscience. It is like a moral compass. The more I go against it, the more ‘off track’ I feel. If I am going off track, that means I am entering dangerous territory, and therefore I do not want to be there. Clearly, we do not always keep to the right path in life, but I will at least attempt to stick to it as much as I can.
Photo credit: David Castillo Dominici/freedigitalphotos.net