Responsible investment | Hargreaves Lansdown

The words Responsible Investing are presented on screen as the video starts. The video is animated with various
scenes providing illustrations and metaphors for the narration. The italicised subheadings below should appear
on-screen.

What it means to be a responsible investor is different to each of us – it depends on our values and our beliefs.

There are several ways you could invest responsibly:

A Sustainability Focus means investing in companies that are sustainable for the environment or society, and
likely to remain so into the future.

Sustainability Improvers means investing in companies that might not be environmentally or socially sustainable
today, but have the potential to improve their sustainability credentials over time.

Sustainability Impact is about investing in companies that make a positive measurable difference to the
environment or society.

And then there are sustainability mixed goals, which combines companies that are already sustainable, those that
have the potential to become more sustainable over time and those that aim to deliver a positive impact.

Funds that take these approaches to sustainability will be clearly labelled to help you choose a fund that meets
your preferences.

ESG integration is about considering the environmental, social and governance risks and opportunities of an
investment as part of your wider research. We think all investors should be thinking about ESG Integration – it
makes good investment sense.

A stewardship approach involves interacting with the company you invest in to drive change. For most investors,
this will mean voting at a company’s Annual General Meeting, but fund managers usually have bigger stakes in
companies, which means they can often share their views with the management team directly.

If there are certain areas you don’t want to invest in, perhaps for moral or religious reasons, you can consider
excluding them from your investments entirely.

So how do you find responsible investments?

You can manage a share portfolio using any one of these approaches, or you can mix and match the approaches to
meet your own requirements. If you don’t have the time or expertise to choose shares yourself, you could consider
funds.

Most mainstream funds incorporate stewardship and ESG integration, but some do so more than others. If you want to
take this a step further you could invest in a fund focused on benefiting from sustainability-related
opportunities, or an exclusions-based fund.

This video isn’t personal advice. If you’re not sure what’s best for you, ask for financial advice. Investing
for
longer increases the likelihood of positive returns. Over a period of five years or more, investments usually
give
you a higher return compared to cash savings. But unlike cash, investments can go down as well as up in value,
so
you or your children could get back less than you put in.