Why invest in an SRI fund?

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4 min
By Birdee
Investing in an SRI fund is a commitment to the future with profits today. Discover responsible investments with Birdee.

If you want to uphold your ideals, protect the planet and invest more sustainably... then you are just like us! Birdee has chosen to offer responsible portfolios, consisting of at least 82.5% of assets labelled SRI ("Socially Responsible Investment").

But can you really reconcile ethics with financial investments? Yes, let us explain. Birdee invites you to discover why you should direct your investments towards SRI funds: invest while making a positive difference to the environment.

What is an SRI fund?

The definition given by the Association Française de la Gestion Financière (AFG) offers a perfect explanation: "SRI is an investment that aims to combine economic performance with social and environmental impact by financing companies and public entities that contribute to sustainable development regardless of their sector of activity. SRI promotes a responsible economy by influencing governance and actors' behaviour."

For a financial product to be classified as SRI, the companies in which it invests must meet three ESG criteria:

  • Environmental: certify good waste management, implement concrete measures to reduce greenhouse gas emissions and draw up environmental risk prevention plans;
  • Social (this criterion concerns the company's HR policy): take measures to train staff, prevent the risk of accidents, improve social dialogue, ensure respect for human rights, limit the impact on health and the environment of the products used;
  • Governance: this criterion mainly concerns the independence and diversity of directors, as well as the existence of an audit committee.

According to Novethic's annual indicator of sustainable funds in France, the SRI market is growing: assets under management almost doubled in 2019, climbing to 278 billion euros, and the number of SRI-labelled funds increased by almost 50%, with 704 funds registered.

These criteria reflect my values, but how does that change my investment portfolio? Let's take a look at the characteristics of these ethical investments.

What are the advantages of a socially responsible investment?

First of all, SRI funds offer an equivalent performance

That is the main reason to invest: to achieve a return on your investments. Rest assured, the financial performance of SRI funds is equivalent to non-SRI investments. Although sustainable finance long had a poor reputation, things have moved on. Savers who are concerned about social and environmental practices are not penalised by the rules applicable to responsible investment.

On the contrary, the selection of companies based on financial and non-financial data (ESG criteria) brings added value, for example by reducing certain reputational or regulatory risks. This virtuous process even tends to slightly improve the financial performance of the selected investments.

Finally, the economic crises of 2008 and 2020 changed how SRI funds are viewed. Indeed, two-thirds of them withstood the market downturn better than traditional funds.

Second, investing in SRI gives meaning to your savings

Like many savers, perhaps you wonder about the impact your investment choices have on employment? on working conditions? on the environment? on pollution? Those working in the investment sector have taken this on board and, in response to the growing awareness of social and environmental issues among the general public, have now developed suitable investment products. This change in philosophy alone is a small revolution in the world of finance.

Investing in an SRI fund has become a concrete and rewarding act that appeals to many in France. In choosing an SRI-labelled fund, investors are looking to invest in a vehicle that really makes a difference, as opposed to traditional products that focus their marketing on financial performance.

Finally, SRI allows you to invest for the long term and diversify your investments.

SRI is often associated with long-term investment as it finances companies with values that will have a lasting impact on the future. By supporting companies that meet the challenges of tomorrow (cutting CO2, clean engines, public transport, etc.), you are committing to economic activity that will enjoy strong growth in the years to come.

And, as the saying goes, "don't put all your eggs in one basket!" That is a key rule in limiting risk and ensuring successful investments. SRI funds are a great option and allow you to diversify your assets while securing a satisfactory return.

Okay, but how do you invest in SRI funds?

When you decide to invest your money in an SRI fund, you want transparency and regular monitoring. With this in mind, Birdee has developed customised investment solutions, where you can choose to invest according to your interests (social, environmental, health-related values, etc.).

Birdee supports the vision and actions in favour of sustainable development and is committed to investing in sustainable, responsible and profitable financial vehicles. We do not finance coal mining or the arms industry, for example. Don't wait any longer, sign up online from just €50. It is quick and easy with Birdee.


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