When I am a loss for the subject of a column, all I have to do is go to the Internet and I quickly find something to write about. What I found is a SEC press release that states the SEC has charged a mutual fund manager with violating socially responsible investing restrictions in socially responsible mutual funds that investors were told would not contain securities issued by companies involved with producing weapons, alcohol, tobacco, or gambling products.
The SEC alleged that the SEC-registered investment adviser to several socially responsible mutual funds purchased at least 10 securities that the funds' socially responsible investing restrictions prohibited them from buying contrary to representations it made to investors and the boards of the funds. The advisor agreed to settle the SEC's charges and paid a penalty of $500,000.
According to the SEC order, purchases were made in the securities of companies that derived revenue from the manufacture of alcohol or gambling products, derived more than five percent of their revenue from contracts with the U.S. Department of Defense, or failed to satisfy the funds' environmental or labor standards violated the funds’ restriction.
Yes, there is increased interest in environmental concerns, but we are now seeing more and more economic implications in many diverse areas. For example, I have also noticed more accounting firms publicizing their “going green” efforts within their firm, and have come across some firms and companies that advise businesses on the economic benefits of going green. These accounting firms are studying and advising on the economic incentives and surcharges that governments at all levels are utilizing to try to instill environmental stewardship.
Going green for these firms will have a double meaning, and that might not be bad as the environmental cost becomes more associated with economics costs, a subject that accountants are especially adept and skilled at dealing with.
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