Our Profit Distribution | 2006 Report | Giving List

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2006 Special Project Reports

Lee Coates introduces our 2006 Profit Distribution Report.

Our Profit Distribution policy has been an integral part of Ethical Investors since it started in 1989. When Mike Head and myself were deciding upon the profile for the company and addressing the numerous issues involved in starting a new business we felt that this was a key area. At that time there were very few ethical financial advisers (and even fewer offering advice solely on ethical and environmental options) but nevertheless we were keen not to be seen to be jumping onto what was then a relatively new bandwagon (still under manufacturer's warranty).

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(Girls at the Asha Bhavana housing and rehabilitation project in Mysore, run by the Rural Literacy & Health Programme (RLHP). See the project diary for more details.)

In addition, we were sufficiently confident of success that we wished to devise a method that would both ensure an involvement in our profitability for all clients and furthermore offer funding to organisations within the fields selected by the same clients. For the first 10 years we operated a system where every investor was given a "vote" upon completion of any financial transaction using Ethical Investors. This resulted in large sums of money being distributed to an ever-expanding number of organisations but finally we became victims of our own success and the loyalty of our clients; the process of collating many hundreds of votes became quite onerous (but was manageable) but sadly the reality of thereafter distributing (and verifying) the numerous beneficiaries became unmanageable.

This set of circumstances led to a change of policy where we moved to a 'themed' voting system which allowed clients to choose from the three key areas that we had identified for support within the charitable world; people, planet and animals. We have operated our annual distribution within this framework over the last few years and have been delighted with the results, as have clients and charities.

For recent annual charitable distributions we decided to make some use of the Charity Advisory Trust for a proportion of the annual distribution because we felt that some of the specific projects that this method accessed were first class. This initial exposure led us to our most recent project when Hilary Blume of the Charity Advisory Trust suggested that we could fund a whole project in total. The outline that she provided, looked fascinating and completely different, and I have no doubt that you will see why we felt that this was such a worthwhile area into which to direct the money that was available. Ethical Investors contribution to the building costs is 25,000.

For the first time it was decided to fund a single large project with the bulk of our annual profit distribution, rather than a series of small projects. Depending upon the success of the project and feedback from clients, we may do more of this in the future. Some may argue that this project does not support all of the three areas to which clients have requested that we direct our charitable giving. I believe, however, that it will become clear from reading my diary of our trip to India that people, planet and animals all gain from this project and we are extremely grateful to Hilary Blume and also immensely proud of what we have been able to achieve. As always, this could not have been carried out without the support of our clients.

Best wishes,

Lee Coates, ACII, AIFP
Director, Ethical Investors

To read the full India report, starting with the briefing note, please click here

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