Moral Decision-Making on What Stocks to Own

In the following video, Fool contributor Matt Thalman discusses a topic affecting all investors: deciding which companies meet our personal moral guidelines.

Matt says that while many companies and industries may appear morally upstanding on the surface, things can change when they're viewed from a different perspective. For example, some consumers may be outraged by how much money they pay to utility companies every month, but the moral dilemmas can go much deeper when looking at things like the environmental damage caused by coal-fired power plants, or the threat posed by nuclear reactor malfunctions and the disposal of spent fuel rods.

As investors, Matt says, we all need to decide what we consider moral or immoral and then decide which companies to support accordingly.

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  • Report this Comment On July 13, 2013, at 10:08 PM, ScottAtlanta wrote:

    "....and stuff like that," this is a "trivializing phrase" when you're talking about serious issues.

    "nucular" is not a word, you must mean "nuclear." -- if it was just a matter of "preference" or dialect, I would not mention it. But it's just plain wrong.

    Setting those objections aside, I would highlight what appears to be an argument of "Moral Equivalence" in your guidance: since all companies may be morally irresponsible on some level...."pick your poison," no one can do it for you.

    I don't think this is an adequate response though I do applaud you for talking about the topic given it's importance to many.

    Although your insistence that ultimately the individual investor must decide what is acceptable and what is not is accurate...there are groups that do this sort of assessment.

    Along these lines, many companies, knowing that they cause harm and exploit current conditions, make at least some types of commitments for better choices and put money into rectifying those conditions. Identify those companies.

    Further, I think with some objectivity we can say that some companies are worse than others. Again, organizations committed to these causes can clarify what the moral positives and negatives are of a company, and this can help one decide.

    See for example, "Ethical Consumerism" at for a full discussion and groups that rate corporations.

  • Report this Comment On July 13, 2013, at 11:06 PM, grahamsway wrote:

    A great topic.

    I'd propose that if morals are going to be an important determining factor for an investor, they have to really decide if they want to be in stocks at all.

    There can be a compelling case made that virtually every company is going to be "bad". It seems that, maybe now more so than ever, when it comes to a choice between treating the customer as a sucker versus giving them a fair break, its a clear cut decision from the corporate suite. From cutting corners to save a few bucks, raising prices to meet Wall Street expectations, slyly reducing product size, to blatantly deceptive marketing campaigns, there are probably an insignificant few companies that espouse to the "treat others as you would want them to treat you" credo.

    IMO, if one looks closely at big business, forget about the financial markets sewer, it would be difficult to find any meaningful moral basis to get involved at all.

  • Report this Comment On July 14, 2013, at 1:23 AM, singaporenick wrote:

    Yes,it is always a difficult issue.

    I try to have some moral guidelines in what companies I invest in:for instance,I would never invest in Exxon Mobil for moral reasons,but other investments I have are in companies that no doubt do some things I do not like.

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