What are positive and negative screening?

What are positive and negative screening? image

When you start your ethical investment journey it’s important to determine what your ethical beliefs and mind-set are.

One way to work this out is to decide how you would like to consider positive screening and negative screening when it comes to choosing which funds to invest in. These terms can also be referred to as thematic and exclusion-based screening. 

Positive (or thematic) screening involves investing in funds based off the positive impact that they are having in the world. For example, if you have a particular interest in education, you might want to ensure that the funds you invest in are involved in the provision of educational materials for children in developing countries. Or maybe you are committed to using only green energy. So, you might want to investigate companies that produce component parts for solar panels or wind turbines. Bear in mind that you could be surprised by the companies that are doing good and that may fit with your ethical criteria. We look for strong evidence of a commitment to ESG and other ethical attitudes. The main thing we focus on with positive screening is ‘What good things are this company involved in?’ and ‘How are they positively impacting the world?’. 

Negative (or exclusion based) screening, on the other hand, involves actively avoiding funds based off the negative impact they are having on the world. It began as exclusion-based screening as it involved simply avoiding companies that were ‘doing bad’ (i.e., tobacco, armaments, fossil fuels) but now it is a much broader term. Some investors will consider wider criteria such as the gender diversity on a company’s board, whether they pay their employees a fair wage or the size of their carbon footprint. 

You may find that to adhere to your personal beliefs, you must adopt a combination of positive and negative screening to get your desired result. There may also have to be some compromise to create the best result. We’ll do the deep research for you; you don’t have to worry about seeking out these companies yourself. Once you have determined what your ethical beliefs are, we’ll be able to recommend the funds that we deem to be the most appropriate. Our research team are highly knowledgeable and passionate about finding the best funds to match your ethical mindset. We will always strive to make sure that your money changes your world. 



It is important to take professional advice before making any decision relating to your personal finances. Information within this article does not provide individual tailored investment advice and is for guidance only. We cannot assume legal liability for any errors or omissions it might contain. Ethical Futures llp is authorised and regulated by the Financial Conduct Authority.

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