The LGBT community is extremely thoughtful and generous in donating to charitable organizations. We give our money and time to issues that personally matter to us. It’s easy to understand which organizations are helping HIV+ people, counseling LGBT youth or fighting for marriage equality. You know that your efforts are going toward important personal beliefs. But when it comes to investing your retirement money, it’s much more difficult to figure out if your investments are gay-friendly.
The first place to begin is with HRC’s Corporate Equality Index. Every year, HRC analyzes publicly-traded companies using several criteria. A company will earn more points for achieving different criteria like an equal employment policy that includes sexual orientation and gender identity, providing same-sex partner benefits and demonstrating a public commitment to the LGBT community.
The maximum score is 100 points. For 2013, more than 20 percent of Fortune 500 companies tallied a perfect score. And many more of these large companies, although not perfect, scored very high. However, there are some not-so-friendly companies out there. For instance, Exxon Mobil scores a -25 points (the only company with a negative rating) and Berkshire Hathaway scores a zero (the famous investor Warren Buffett owns most of this company). The Corporate Equality Index is a great place to identify stocks in your portfolio that are gay-friendly or not.
Ideally, there would be a mutual fund that had a gay-friendly focus. Unfortunately, that doesn’t exist. I did recently discover a gay-friendly portfolio on a Web site called motifinvesting.com. This company creates portfolios based on ideas. For example, there is a portfolio called Democratic Donors that consists of companies that donate to the Democratic Party. It’s up 34 percent for the last year, which is double the 17 percent return of the Republican Donors portfolio. Hmm, bet that’s interesting to all the politicos out there.
Motifinvesting also has a gay-friendly portfolio that is based on HRC’s Corporate Equality Index. This portfolio, which is less than a year old, consists of 25 gay-friendly companies that scored a perfect 100 by HRC. The neat thing is you can buy these 25 stocks in one trade for a $9.95 commission. The alternative is to buy each individual stock paying a $5-$10 commission for each trade. This idea is worth a look if you’d like to own gay-friendly companies such as Apple, Google, Disney and Chevron.
Another way to keep your investments and beliefs in alignment is to seek out SRI mutual funds. SRI can stand for either Socially Responsible Investing or Sustainable and Responsible Investing. Whatever people like to call it, many SRI mutual funds include sexual orientation in their key screening criteria when choosing stocks to buy. Two mutual fund companies to check out in this space are Domini Social Investments and Calvert Investments.
Deciding if your investments should be in alignment with your personal beliefs is an individual choice. But if you do decide to invest this way, you now have some resources to help achieve that goal.
Steve Doster is a Certified Financial Planner™ professional providing commission-free financial advice for do-it-yourself investors. You can reach Steve at Doster Financial Planning by phone 619-688-1192 or email steve@dosterfinancialplanning.com. You can also follow Steve on Facebook, Linked In, Twitter, or blog to get more personal finance advice and tips.
