Ethical funds set pace on growth

New research has underlined the upbeat performance of ethical funds, highlighting the opportunities they offer to investors to enjoy healthy returns while sticking to their principles.

Figures released by independent comparison website moneyfacts.co.uk on 14 August show the average ethical fund grew by 24 per cent over the last year, compared with 18 per cent for the average non-ethical fund.

Over three years, the average ethical fund was up by 36 per cent compared with 31 per cent for the average non-ethical.

Over ten years, the average ethical fund grew by 56 per cent compared with 128 per cent for the average non-ethical fund. However, markets such asChina/Greater China and global emerging markets, which have seen huge growth, have no ethical funds with a ten-year record, distorting the figures.

A typical ethical fund includes companies likely to have a positive impact on society and the environment – such as those involved in renewable energy, sustainable timber and waste management – balanced by others regarded as ethically “neutral”, excluding those involved in mining, tobacco, alcohol or arms production, for example.

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