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SRI Chat - Socially Responsible Investing
Subject: Re: Re: Re: Re: Re: What should a new SRI fund offer?
From: Ethan
Date: 09/11/00
Dear Pete-
(Sorry for the looong delay...I've been in the field in Mexico.)
The problem you're describing is what economists pompously refer to as 'asymetric information'...presumably each of the many screened funds works out their own methods of determing who to screen for what. Since this is not the core competency of stock brokers, we should not be suprised that it costs us a great deal. There are institutions whose entire function is to screen companies (E.g. the Consumers Union, the Shopping for a Better Planet people, and in a larger sense industrial standard institutes such as ANSI.) I think an important missing link in the chain is to get these institutions to provide accurate data to fund managers in a way that they can easily digest into market screens. Obviously this involves insuring income to the 'watchdog' institutions, but the absolute costs of this would be much less than the inefficient research each fund is using right now.
-E

 

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