In looking to Europe-based funds, ethical investors uncover a separate universe of opportunity. Europe boasts some 300 SRI funds, versus only about 110 in the US. The European Social Investment Forum provides a list, along with performance statistics, at www.eurosif.org.
Investing directly in foreign funds, however, might not be for everyone. Since these funds can't legally market themselves to Americans, US-based brokers are seldom familiar with them or able to provide informed advice. That means investors need to do their homework, first to find funds that accept investment dollars from Americans (they don't have to) and second to evaluate their merits. In practice, few investors will go that distance, says Doug Wheat, director of SRI World, an information source for ethical investors in Brattleboro, Vt.
"I just don't think people will do it," Mr. Wheat says, noting that convenience is a key driver for most small-scale investors. "I mean, if you can't buy these things on Schwab or some [other brokerage] like that, people just aren't going to do it."
To make SRI international investing easier for Americans, Prince Albert of Monaco will launch a product especially for them in September. For a $1,000 minimum contribution, investors will gain a stake in a fund of funds, similar to a three-year-old fund now available only to Europeans. The idea: Find the best fund managers who in turn find profits in industries that inherently generate social benefits, such as natural foods, renewable energy, and water-resource development.
The fund is in the works for Americans because they have indicated a desire to broaden their influence as environmentally minded investors, says Jerome De Bontin, founder and president of Sustainability Investments LLC, a Northbrook, Ill. firm commissioned to bring Prince Albert's fund to the American market.
"We've received the phone calls" from Americans wanting to invest in the fund for Europeans, known as Monaco Environment Development Durable, Mr. De Bontin says. Those who call increasingly recognize "we're dealing with global issues and global answers. It is not possible to deal with global warming, with rising sea levels, with pollution of the air, and try to focus on a domestic company. You have to deal either with companies that have international reach or you have to deal with companies that deal with technology that can be applied worldwide."