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About 3d investing
Why 3D Investing
| What Is 3D Investing | Performance | Choosing 3D Funds

3D investing takes many forms, but all are different ways of reflecting whole-life values in your investment planning. The principle ways of achieving this are:

3D investing started with ethical investment, which is synonymous with excluding companies on the basis of their transgressions. For many people, this is still a valid approach, as the foundation of any socially motivated approach to investment is to avoid the 'nasties' like tobacco, armaments or gambling.

The fund or the investor specifies the level of exclusion that they wish to employ and a screening company applies that screen to the investment universe to ensure that the specified criteria are followed.

Tip - Its important not to be too restrictive or you could end up with very little in which to invest. Just avoid the type of companies in which you couldn't countenance any investment regardless of the financial consequences.

Download Exclusion Criteria


Thematic Investing

Excluding inappropriate companies only goes so far and can lead to an investment portfolio that looks little different from conventional funds. If you truly want to believe in your investments, you will want a portfolio about which you can get excited - investments that deliver solutions to the major environmental and social challenges that we all face.

Thematic investing allows you to focus on investments that have the potential for high social, environmental and financial returns, since they are driven by social and environmental challenges such as global warming, demographic change and pressure on resources.

Tip These type of investments may expose your capital to significant risk of loss, so you need to decide how much of your overall investments that you are prepared to place at risk, given the potentially high social and environmental returns.

Download Thematic Criteria



Engagement is an investment approach that seeks to bring about change by influencing the companies in which investment is made. Rather than avoiding companies because of the nature of their activities, fund managers seek to engage with the companies in which investment is made, using their influence as major shareholders. This normally takes place by way of dialogue with senior company management, but it can also take the form of shareholder resolutions and as a last resort, disinvestment.

Tip Many fund managers claim to exert some form of influence on the companies in which they invest. Only a few commit the resources necessary to systematically engage with companies on social and environmental issues, and you can only judge how well an engagement policy is implemented if this is reflected in a public report on engagement activity.

Download Engagement Criteria


Best of Sector Investing
Best of sector or class investment generally means expressing a preference for investments that demonstrate social or environmental leadership in their industry. This allows fund managers to invest without excluding whole industries, and also facilitates investment in larger companies which may be excluded by a more restrictive approach.

Tip Check the actual underlying investments and the methodology for selecting investments. Is 'best of sector' being used to justify investments when the primary reason is financial? Have the fund managers addressed all of the key issues in justifying 'best of sector' status?

Download Best Of Sector Criteria


Socially Directed Investing
Socially directed investments have a primary objective of improving social or environmental welfare through business. Most investments of this type may be difficult to sell and may generate modest financial returns relative to the risk of capital loss. The primary return is therefore likely to be social/environmental rather than financial, although some investments of this type may also generate a competitive financial return.

Tip Decide how much of your overall investment portfolio that you are prepared to commit to this type of investment and consider the balance of risk / financial return / social return that you wish to achieve.

Examples of Socially Directed Investments