There are several processes which fund managers can use to decide which companies to invest in. These include:

• Screening: Screening can be undertaken as part of the funds management process and it entails the assessment of investments against selected SRI criteria.

Examples of common screens used in an SRI portfolio are: environmental, human rights, labour rights and workplace practices, animal welfare, corporate governance, gambling, alcohol, tobacco, weapons and uranium.

The application of SRI screens to increase animal protection could involve:

1. Negative screens, used to exclude investment on the basis of company involvement in a specific type of activity, for example animal testing or intensive ‘factory farming’ practices.
2. Positive screens, used to exercise a preference for certain characteristics or activities of an investment. For example, preference for companies involved in free-range farming; the development of alternatives to animal products; or the creation of new technologies to replace the use of animals for scientific and teaching purposes.
3. Best of Sector screens may involve rating all companies on a range of animal protection issues and then only investing in the most highly rated companies.

One alternative to the screening process is for a fund manager to approach those companies that do not perform well on animal protection issues and encourage them to lift their performance.[7]

• Share-holder advocacy: This process requires shareholders to actively address a company’s behaviour by exercising their rights to raise issues with the management of the company.

Shareholders may choose to form a collective to maximise their voices for animals. This mechanism may provide greater powers of persuasion and the ability to vote en masse on issues of concern. 

• Community investing: This is the pooling of deposits in order to loan money to specified groups in the community. These groups can include not-for-profit organisations or disadvantaged individuals.
  
  Community investing could be applied to animal protection groups such as animal shelters or sanctuaries.
  

• Caused based investing: This is the focusing of investment on an area of perceived need. For example, the need to develop an alternative to animal testing or humane agricultural practices. 

7. Kerr & Zubevich, An Introduction to Socially Responsible Investment (December 2002) Australian Conservation Foundation, p 5 at 16 November 2006.  

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