Examples he gives include:
- Telecommunications companies providing fixed and mobile connections to remote areas.
- Food companies ensuring there is no child labour employed among their suppliers.
- Banks providing customers with financial products they need.
"This is of great importance for investors as the CSR issues are important for the sustainable long-term value of the companies themselves."
Ms Sofat points out that "relationships with the local community and charities are often part of a company’s social responsibility programme. Gender and diversity issues also fall under the CSR umbrella".
This is clearly seen in grass-roots movements such as the 30 Percent Club, which has resulted in more boards across the FTSE All-Share taking notice of the need to diversify their boards of directors along gender, racial and cultural lines.
And she believes it is getting easier for investors to see who is doing it right, not just those who are doing it wrong.
Ms Sofat explains: "CSR scores are one way of measuring how a company is doing and wealth managers are beginning to pay more attention to them.
"Managers of 100 per cent ethical funds already have clearly mandated rules about who they invest with, and report very stringently about a company’s CSR policies."
So it is not just about avoiding those companies who are hitting the headlines for the wrong reasons, but those who are quietly doing it right behind the scenes.
simoney.kyriakou@ft.com
