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One hears so often that the financial instruments that the banks use are so complex that even the banks don’t understand them.  It is that lack of transparency that can lead to unwillingness to trade.

How often have we as individuals been put off buying something because we are not really sure what it is we are buying into?

Have you ever put off starting a pension, insurance even an ISA because it’s hard to understand what you are committing too?

And even when you do decide to invest and go the one step further to invest ethically how can you be sure that you have a way of influencing the people setting the ethical profile for your money?

Most ethical investment fund manager will listen, some will be influenced, but none actually institutionalise a process for allowing investors to have a real say.

And then there is the other hurdle, even if you feel strongly about an issue in an ethical fund and you would like that issue to be addressed how do you know if other investors feel the same, you’ll never  be told who else is investing.

It was to address these issues that King and Shaxon (a leading firm of ethical fund managers) worked with Alan Kirkham of Investing Ethically to devise an investment that changes the way that ethical investment in managed, that tries to put real authority back with the investors.

First they decided that the ethical profile should be set and overseen by an independent governance committee.  The membership of that committee would be only Friends or Attenders.

Then they decided to split the setting of the investment environment (the companies in which King and Shaxon can but don’t have to, invest) entirely from the investment decisions.

Then they thought that the Governance Committee should be guided by yet another independent research body to ensure that the investment fit the ethical profile.

But they wanted to address the issue of transparency and investor authority so they decided three things:

1)      There would be a discussion group on the internet where investors could talk to each other. That way concerns could be shared and tested.

2)      There would be an AGM where the investors can minute their wish to make changes in the ethical profile. E.g. the recent concerns about Palestine, bank bonuses, tax avoidance.

3)      The investors would have the right to appoint one third of the Governance Committee, another third would be offered to the wider Friends Community and the final third appointed by King and Shaxon.

4)      Finally they decided that direct phone numbers, email addresses would be given to investors for both the Clerk of the Governance Committee and the investment managers at King and Shaxon.

This way there would be an unprecented level of transparency and influence.

The initial ethical profile has been set and is available; it follows very closely that of BYM.

Of course investors don’t need to get involved, like any other investment they can trust the people looking after their money, but if they want to have a real say then the opportunity is there.

The project is called QPortfolios and details are available from Wayne Bishop (King and Shaxon) 020 7426 5979 or Alan Kirkham 01603423639