TERROR FREE INVESTING
Many pension systems and individual
investors choose to divest from -- or screen out of portfolio -- the
stock of companies that do business in Iran, North Korea, Sudan and
Syria. This new category of values-based investing has been termed
"Terror-Free Investing." Former Missouri Treasurer Sarah Steelman summarized the reasoning of many investors that have chosen to invest "Terror Free", stating:
"These countries have been sanctioned by the United States government as state sponsors of terrorism. We have no business investing in companies that are engaged in projects involving these governments. Investing in terrorist countries is not acceptable to the citizens or the public employees of the state of Missouri."While CSAG's Global Security Risk Monitor database of companies with ties to terrorist-sponsoring states was designed to help investors assess risk, CSAG's research is increasingly employed by asset management firms to comply with new "Terror-Free" investment restrictions and by some firms that are offering "Terror-free" or "Sudan-free" retail products (i.e., mutual funds, indices or similar investment options that screen-out companies with business ties to Sudan or other terrorist-sponsoring states).
While CSAG does not advocate use of the Global Security Risk Monitor as a "divestment list," we recognize the right of individual investors or public pension systems to choose whether or not to invest in companies that do business in terrorist-sponsoring countries. In that connection, CSAG seeks to make its research widely available to those wishing to establish a "Terror-Free" investment strategy.
- CSAG works with pension systems and their asset managers to help
funds design and implement custom "Terror-Free" international
portfolios.
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