I usually scoff at people that say they wish to invest ‘ethically’. After All, it’s a great way to limit your investing universe and hence your potential returns. Most ethical investments conjure images of hippies and protesters for me.
But recently I came across a company which is involved in an industry that I do feel quite strongly about, and find myself confronted with the choice over whether I actually want to be an investor in a company using practises I do not consider to be ethical. That company is Avangardco, which produces eggs through intensive farming. Try as I might, I could not find any references to their animal welfare or whether they are battery farming in their annual report. I can only assume, given they are based in the Ukraine and that they don’t advertise any consideration of welfare, that their standards of care are quite low.
Now I wouldn’t even consider buying their eggs, but their stock is a different matter. After All, me buying their stock is in no way going to affect the company itself, these bad things will happen regardless of my holding in the company, so maybe I should just treat this like a piece of paper being traded. But there is something inside me, a niggling gut instinct that just says I shouldn’t consider an investment in this company when I so strongly disagree with its practises. Maybe I’m being a hypocrite, living in ignorance of the things all my other holdings get up to, after all Cranswick slaughters pigs and Deckers Outdoor use sheepskin. But there is just something about factory farms that evokes that ethical compass inside me and says no.
I don’t have an answer to this, I’m still of two minds. I plan to read the annual report in the next week or two as other bloggers have commented on it and it looks like a great potential investment. If it looks like a good buy, we’ll see who wins the battle, greed or ethics.
Investing Sidekick
Founder of Investing Sidekick. Works as a research analyst and is an avid value investor, always searching for undervalued shares.