However, like most socially responsible investing funds, Vanguard's new fund will shun stocks like big oil, tobacco and alcohol. Socially responsible investing is hot these days, but that hasn't always been the case. Social criteria are not a barrier anymore. When asked about mistakes people make in the area of socially responsible investing, Domini said that most people start out a little na ve and try to be consistent with their lifestyle. Socially responsible investing is not really about buying socially responsible companies.
Corporations are increasingly the dominant force on the planet.
Shareholders are the owners and it's important to maximize our returns but not at the cost of our children. As for Vanguard's place in this market, Domini says it has a very nice business with small endowments and that there is a market for this product in the endowment area. Vanguard saw competitors evaluating or getting into it and they saw the growth. And possibly they saw our goodwill in the marketplace. I think Vanguard has other funds that invest in companies not much different than Vanguard's new Social Index fund.