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I felt like a vegan at a meat lover’s potluck. A radio show manager asked me to speak in the United Arab Emirates. Plenty of people live and work in the UAE. There’s an unusually high emphasis on money. Perhaps that’s why Dubai Eye’s The Business Breakfast show is so darn popular. Several times before, I sat in the studio with the show’s affable hosts (two Brits and a New Zealander) to talk about ETFs. Each time, several listeners texted questions. But on this occasion, we had crickets, not texts.

I spoke about socially responsible investment (SRI) exchange-traded funds (ETFs). Perhaps that was my mistake. After all, I was in a city that, perhaps more than any other, was built on the back of fossil fuels. Perhaps, if I were in Berkley, Calif., or Vancouver, my hosts (and the listeners) would have warmed to these fund ideas. After all, they’re increasingly popular among the environmentally conscious.

Socially responsible ETFs include stocks of companies that adhere to specific principles. Most include higher exposure to businesses with smaller carbon footprints and strong social justice records. They shun companies that manufacture weapons, cigarettes and alcohol. Most SRI funds also exclude stocks connected to pornography and gambling.

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Most socially responsible ETFs charge slightly higher fees than traditional ETFs. But their returns don’t seem to suffer: Some studies say SRI funds perform better than traditional indexes. Other studies show they slightly lag. Much depends on the time periods measured. Michael Schröder of the Leibniz Centre for European Economic Research compared 29 broad market indexes to comparable SRI indexes. He says, “SRI stock indices do not exhibit a different level of risk-adjusted return than conventional benchmarks.”

Dr. Schröder published his research in 2007. That year, iShares launched its Jantzi Social Index ETF (XEN-T) of Canadian stocks. It charges more than most ETFs: A management expense ratio (MER) of 0.55 per cent. But that hasn’t hurt investors: Some years, it beats the iShares Core S&P/TSX Capped Composite Index ETF (XIC-T). Other years it doesn’t. But its performance aligns with Dr. Schröder’s findings. Since its inception, it battles toe-to-toe with the broader stock market index.

Socially responsible ETFs are also growing in popularity. According to Morningstar, 39 of the 965 ETFs available in Canada now have a socially responsible lean. Some of Canada’s robo-advisers, including Wealthsimple, CI Direct Investing (formerly WealthBar), ModernAdvisor and Questwealth Portfolios also offer portfolios of SRI funds.

BMO and iShares recently launched all-in-one portfolios of socially responsible ETFs – and they’re cheap. For example, the MER for the BMO Balanced ESG ETF (ZESG) is just 0.20 per cent.

This brings me back to Dubai and the tepid reception to these funds. Most of the people there don’t work for the oil industry, so you might be quick to ask, “Don’t they care what they support?” However, this might fuel a misconception about SRI funds.

When you own shares in a publicly traded company, you aren’t supporting that company’s earnings. You aren’t giving the business money that it will use to mine materials, make harmful products (such as cigarettes) or build nuclear weaponry. Instead, you would just be buying a piece of that business on the open market. In other words, when you own a company’s stock (directly or through an ETF) your money doesn’t fuel the earnings of that business.

Consider Tesla Inc. and Exxon Mobil Corporation. If you bought shares in Tesla, the company wouldn’t use that money to build electric cars. If you bought shares in Exxon Mobil, the firm wouldn’t use your money to find more oil. Instead, in both cases, you would become a passive owner, indirectly benefiting from the business profits earned.

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It would be different if you bought one of their corporate bonds. In that case, each company would use your money to fuel their enterprise. You might also support a business if you bought shares in a small company initial public offering, or if a small private business needed your money to operate. But in most cases, with liquid companies on an established stock exchange, that is not the case.

If you really want to support (or neglect) a business, vote with your wallet. We support businesses when we buy their products or use their services. We don’t, however, help specific businesses when we buy an ETF or stock. That’s why our values should align with how we spend our money.

Buying a socially responsible ETF won’t make the world a better place.

That doesn’t mean SRI funds are a gimmick. I like them. They can help us sleep better, if we’re profiting from companies we respect.

Ironically, however, the environment prefers that we keep our wallets closed. Almost everything we buy (whether it’s a Tesla or an iPhone) has an environmental impact. It sounds bohemian when I say we should walk more, drive less, eat local and maintain what we own instead of buying new stuff.

But that’s the inconvenient truth about money and the planet.

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