Is there any ethical funds / AMC in India?

POSTED BY Raj ON December 4, 2012 11:47 pm COMMENTS (10)

I was wondering if there are any funds that pick only stock of companies that run business in ethical ways (not involved in any scams, looting public money) or in business that is setup in green way etc. (I’m not implying ethical in a religious sense like Amana funds in US)

I wish there are few ethical funds in India that could generate AUM of few thousand crores that way public have a strong say in how companies do business in India.

Hope Reliance doesn’t launch it with a name Anna Kejriwal MIS – Growth 😉

10 replies on this article “Is there any ethical funds / AMC in India?”

  1. Raj says:

    Oops some typo – I meant to say in a distinctive Indian context socially responsible investing should encourage investing in non-corrupt companies.

  2. Raj says:

    Hi Ramesh,

    I am not at all discouraged by your comment – you have been always helpful in this forum.

    There is an entire article about socially responsible investing in Wiki – http://en.wikipedia.org/wiki/Socially_responsible_investing.

    Wiki’s definition says “socially responsible investors encourage corporate practices that promote environmental stewardship, consumer protection, human rights, and diversity.” In a distinctive Indian it should also include corruption as well.

    1. Ramesh says:

      I would say the Shariah index fund will be the closest you can get to that in India.
      I would say, there should be a holistic approach to this kind of thing. Right from your income generation to savings and expenses. This kind of thing should actually take more of our mind space than many other things.

  3. TheZionView says:

    Ramesh its not uncommon for many MF to have 3% FMC in many countries. There are fund with 5% entry loads in certain countries i have heard.

    1. Ramesh says:

      I know. In US, there is up to 7% initial charge for active funds, but the FMC is 1-1.5%.
      But, basically I find it a little problematic for an ethical fund to charge such a high fee. See 3% for how much average return over long term 6-8%, I guess. Considering that they are operating in the developed countries whoop have a little lower expected equity return.

    1. Ramesh says:

      Those look like fads and not really very great.
      Ethical investing @ 3% FMC. wow really.

  4. Raj says:

    Yeah. I let an offer from TCS go when Radia tapes emerged.

    Btw, there are few funds in US which does some kind of socially responsible investments and yet deliver good returns. I don’t think these have made any major economical / political impact – but I wish they could.

    1. Ramesh says:

      Can you give some examples of these funds and what exactly do you consider as ethical.

      I don’t want to discourage you, in case my earlier comment shows up like that.

  5. Ramesh says:

    You seem to be very naive.

    I would say, you will have to pick your own stocks in case you are able to identify such companies.

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