skip to main content
25th
Feb 2020
/

Choosing Ethical Stocks and Shares ISAs

Choosing Ethical Stocks and Shares ISAs

Choosing ethical Investment ISAs mean you can put your money where your mouth is, by investing your cash in line with your principles. But how do you choose the best place for your investment? 

ISAs are accounts with a tax-free wrapper allowing you to enjoy tax-free returns from investments. Ethical ISA funds are used to invest in unit trusts, gilts, the stock exchange, life assurance and other ventures along those lines.

With the advent of the climate change crisis dominating the headlines, more and more people are trying to live the most ethical, eco-friendly way possible to minimise their impact on the planet. This includes the type of unit trusts, gilts, stocks and ventures that people are looking to invest in.

What makes the ISA “Ethical”?

Ethical Investment ISAs are accounts which specifically invest your money in socially responsible stocks and shares.

By choosing an ethical investment ISA, you can enjoy tax-free returns on your investments which align with your principles.

Depending on the provider you choose for your Ethical Investment ISA, the following industries will generally be excluded from investment opportunities:

  • Tobacco
  • Alcohol
  • Pornography
  • Gambling
  • Fur trade
  • Armaments
  • Oil companies
  • Mining companies
  • Fire arms manufacturers

This is due to a variety of concerns about these industries and companies ranging from environmental and human rights considerations. These are considered to be harmful for the environment or society, so they’re excluded from investments from Ethical Stocks and Shares accounts.

Some might not necessarily exclude all of these – but rather will examine each individual investment opportunity and company in order to make a decision about an investment. For example, while an investor might be apprehensive about putting money behind an oil company, should that company be working on alternative energy solutions then this might make it a consideration.

I want to open an Ethical Investment ISA. What Do I Need to Consider?

When choosing an account, you need to answer the basic question of what matters to you. What are the values which you want to put your money behind? Are you specifically concerned about human rights? Or about animal rights? Or perhaps you are passionate about environmental issues.

Decide what your priorities are – then go shopping.

There are a great range of accounts out there, with lots of different options - meaning whether you have really strong views on one specific issue, or you just want to generally know your money is making positive change in the world, there will be an account for you.

Is an Ethical Investment ISA or an Ethical Cash ISA for me?

If you are willing and able to leave your funds in an ISA for longer periods of time, such as five years, then an Ethical investment ISA is a good fit for you. If you will need access to your cash sooner, a fixed-rate or Instant Access Cash ISA might be better suited to your needs.

Like all other investment ISAs, when putting money away you need to be aware that the stock market will fluctuate. This means you could end up getting less money back than you invested if your stock performs poorly.

How Many Ethical Stocks and Shares ISAs can I have?

Since you can only open one Ethical ISA per tax year, it’s a good idea to shop around before you choose the account and provider which is right for you.

But you can hold more than one Ethical Investment ISA, as long as you haven’t opened more than one a year. So if you invested in an Ethical Stocks and Shares ISA in the 2019/2020 tax year, you can open a totally new one in tax year 2020/2021.

Read more about Ethical Investment ISAs

Investment Fund Supermarket ISAs

Future World Ethical ISA

from Legal & General

Allows ISA Transfers
  • Fund Choice: Managed Ethical Investment Funds
  • Invest From: £20 per month or £100 single

Why we like it: The Future World fund range range allows you to invest in funds that seek to make positive change. The Gender in Leadership UK Index Fund tilts the investments in the fund towards companies with better gender diversity, while the Future World Climate Change identifies companies that are critical to the shift to a low-carbon economy and are paying special attention to their actions.

This fund is available via: Legal and General investment platform »

Important: Please remember the value of your investment and any income from it may fall as well as rise and is not guaranteed. You may get back less than you invest.

Ethical ISAs

FTSE Future World Climate Change Equity Factors Index Fund ISA

from Legal & General

ISA Option
Allows ISA Transfers
Regular Savings
  • Fund Choice: The fund aims to provide a combination of growth and income by tracking the performance of the FTSE All-World ex CW Climate Balanced Factor Index.
  • Invest From: £20 per month or £100 single
  • Investment Options: This fund may be suitable for investors looking for a combination of growth and income by tracking the shares in companies that score high in value, quality, low volatility and size factors whilst incorporating climate change considerations as represented by the index.

Why we like it: The Future World Climate Change Equity Factors Index Fund invests in companies that seek to make positive change. The fund aims to provide a combination of growth and income by tracking the performance of the FTSE All-World ex CW Climate Balanced Factor Index. The fund is passively managed, to replicate the performance of the Index. As part of the Future World* range, the fund incorporates the L&G Climate Impact Pledge, a targeted engagement process, and may exclude companies if engagement proves unsuccessful.

This fund is available via: Legal and General investment platform »

Important: Please remember the value of your investment and any income from it may fall as well as rise and is not guaranteed. You may get back less than you invest.

ii ACE 40 investments

from Interactive Investor

ISA Option
Allows ISA Transfers
Regular Savings
  • Protection Scheme: FSCS
  • Fund Choice: 140+ Ethical Investments
  • Invest From: £25 a month or any lump sum
  • Investment Options: A selection of 140+ funds, investment trusts and ETFs that they believe offer high-quality ethical investment choices, across a broad variety of markets.

Why we like it: The UK's first rated list of ethical investments to help you align investments with your personal values. Building your investment portfolio can be tough – and it is even more difficult when you want to choose ethical investments. That can mean a lot of research. The ii ACE 40 makes the job easier for you. Interactive Investor select 40 funds, investment trusts and ETFs from over 140 that they believe offer high-quality choices, across a broad variety of markets.

Important: Please remember the value of your investment and any income from it may fall as well as rise and is not guaranteed. You may get back less than you invest.

Junior ISAs

Junior Ethical ISA

from Legal & General

Regular Savings
  • Investment Options: Invest from £20 pm or from £100 lump sum. The L&G stocks and shares Junior ISA is a great way to help you save for a child or grandchild, up to the annual allowance of £9,000 for the 2020/21 tax year.

Why we like it: L&G offer a "Future World" range allowing you to invest in funds that don’t just track the market – they seek to make positive change. e.g. The Future Word sustainable Opportunities Fund invests in a wide range of company shares, bonds, property and real assets (including property, land and infrastructure) which meet's L&Gs long term sustainable investment criteria, based on environmental, social and governance factors, while the Future World Climate Change identifies companies that are critical to the shift to a low-carbon economy and are paying special attention to their actions.

Important: Please remember the value of your investment and any income from it may fall as well as rise and is not guaranteed. You may get back less than you invest.

High Income ISAs

High income ISA ideas:

ISAs Products

Cash ISAs

Fixed Rate & Instant Access ISAs:

Cash ISAs: 

Stocks & Shares ISAs

Types of Stocks and Shares ISA include: 

Stocks and Shares ISAs

Latest News

Our Top Picks for Technology Stocks and Shares ISAs

19th January 2021

The tech industry has been booming for the past fifteen years; and it seems to be a rollercoaster that only goes up. The tech bubble has yet to burst, with companies coming out with more and more technological developments and consumer demand is certainly not slowing down. So, for the tech-savvy investor who wants to put their pennies behind this strong growing industry, we’ve put together our top three picks for Technology Stocks and Shares ISAs. 

Newsletter Signup

Sign up to our Newsletter to get exclusive news and offers direct to your inbox.

About us

ISA.co.uk is a trading style of Fair Investment Company.

We've been comparing and recommending ISAs for many years so you can trust you're in good hands.

About us

4.74 Average

23 Reviews

Jen

I found the way the different options are presented very clear - much more useful than some other comparison sites. I sent it to my daughter as well.

Paul

Very informative, find myself a good ISA account with best return in terms of interest.

Sue

Easy to use website and up to date. Saved the link on my tablet.

Rob Holden

The website was very useful and informative.

Andrew Johnson

ISA can be confusing at first and this site includes a useful and helpful introduction into the world of ISAs

Crowd2Fund

Excellent website - clear and helpful information about different products - and a trustworthy partner.

Sue

Easy to use website and up to date. Saved the link on my tablet.

Steve

Really simple to use and all the information was clear with lots of products available. The interest calculator was really handy too. Have bookmarked and will definitely use again.

Hannah Gordon

This was a really user-friendly site, and was very helpful when it came to comparing accounts and choosing my 2016 ISA.

Sue

Easy to use website and up to date. Saved the link on my tablet.

Anonymous

If you wish to invest in an ISA this site has it all. A super comprehensive range of simply explained products from all the major companies.

Cristina Iacob

Very knowledgeble company with an extensive range of services, a great website with loads of useful information.

Anonymous

Nice graphics and easy to navigate

Dr Alan Rogan BSc PhD FCIOB FCABE Eur Ing

Good advice and professional approach

Razvan

Very helpful for getting my annual ISA

Jonny Doulton

Clear, concise and very professional outfit with an excellent choice of market leading deals.

Paul Tissington

ISA.co.uk not only helped narrow down my choices for a Junior ISA but also provided additional practical information that helped demystify the whole process.

Sunil Karadia

Just the site I needed, I have been looking for a suitable ISA for a while, but as there are so many to choose from, find it difficult to find the right one for me.

James Weatheritt

I found the information on ISA.co.uk very helpful and easy to understand. The site is easy to navigate and find what you're looking for.

Lisa Holden

I found ISA.co.uk very insightful and easy to navigate through. The content was useful and helped me make my ISA decision.

Neta Pourhosseini

I thought the information provided was easy to understand and very informative, I would recommend to friends for deffinite.

Robert Murray

Great selection of Isa products, useful information and a very user friendly site