Screen for Good, Not Evil

There are plenty of powerful stock screeners that can help you evaluate companies using a variety of metrics. For instance, the Fool's own spiffy CAPS stock screener gives you access to price-to-earnings (P/E) ratios, dividend yields, insider ownership, gross margins, returns on equity, cash per share, and lots of other metrics. It will even show you how our community of tens of thousands of stock predictors (including our most accurate All-Stars) have rated stocks.

There's another screener I just discovered, though, at Slate's The Big Money website, which lets you assess S&P 500 companies on five social-responsibility counts. The factors it assesses are gay and lesbian friendliness (by looking at same-sex benefits and nondiscrimination policies), greenness (such as toxic emissions and environmental fines), labor and human rights (including unionization and strikes, and ties to oppressive regimes), nonmilitary character (assessing weapons production and Department of Defense contracts, for example), and "no vice" (screening out those involved in adult entertainment, tobacco, gambling, and alcohol).

I decided to take it for a spin, first asking it for gay-friendly companies. Well, about half of the 500 scored 100, which is great, but didn't leave me with a very manageable list for further research. So I added another criterion to the mix: greenness. That only reduced the list of 100-scorers to about 140. Next up, labor and human rights. And that did it. Suddenly, the top-scorer no longer had a 100 score. Here are the top 10 results I got:

Company

Score

Southwest Airlines (NYSE: LUV  )

98.0

Fannie Mae

91.7

Tenet Healthcare (NYSE: THC  )

90.7

AmerisourceBergen

89.0

Express Scripts (Nasdaq: ESRX  )

89.0

Qwest (NYSE: Q  )

89.0

E.W. Scripps

88.0

Coca-Cola Enterprises (NYSE: CCE  )

87.7

Aflac (NYSE: AFL  )

87.3

Allstate (NYSE: ALL  )

87.3

Data: Big Money SRI Stock Screener. A company with the best performance compared with all those evaluated gets a rating of 100, and the worst, a rating of 1.

This screen can help you find the kinds of companies you'd like to invest in. Just be sure to research them further, looking for healthy financials, brisk growth, competitive advantages, and compelling prices.

Learn more about screening:

Finally, if all this screening sounds tedious, but you do want to consider socially responsible behaviors in investments, consider socially responsible mutual funds instead. You'll find at least one such fund recommended in our market-beating Motley Fool Champion Funds newsletter. Try it for free for 30 days and see all its picks. And jump on over and join CAPS so you can start digging into all that free information.

Longtime Fool contributor Selena Maranjian does not own shares of any companies mentioned in this article. Aflac is a Motley Fool Stock Advisor recommendation. Try our investing newsletters free for 30 days. The Motley Fool is Fools writing for Fools.


Read/Post Comments (1) | Recommend This Article (5)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On October 29, 2008, at 1:57 PM, weiwentg wrote:

    Of course, if you are interested in screening your investments, you need to be aware that the above system doesn't and can't capture all dimensions of social performance. Fannie certainly isn't solely responsible for the whole crisis, but their lobbying in Congress stopped regulators from asking the right questions about them. Fannie's demise has certainly helped damage the system.

Add your comment.

DocumentId: 764975, ~/Articles/ArticleHandler.aspx, 7/23/2014 11:32:34 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement