Best Socially Responsible Investing Platforms in UAE 2023 (June Update)

Page Summary

This guide helps users to find the best trading platforms in UAE for socially responsible investing. Sustainable (socially responsible) investing has gained popularity in UAE as it allows investors to achieve high potential returns combined with positive social or environmental impacts. With the wide range of fintech (reliable and scam) that offer to invest in societal projects, it can be challenging for users to choose the ideal platforms for their needs.

Research, comparison, and background analysis on available providers can help investors avoid selecting a platform with high fees, limited markets, lack of regulation, and poor customer support.

This guide assesses 27 online brokers in UAE for users to research and find the ideal platform for their needs. To help them make an informed decision, a list of the best socially responsible investment platforms in UAE is shared below, followed by detailed reviews and comparisons.

Best Socially Responsible Investing Platforms in UAE

  1. Goparity – Best Crowdlending Platform
  2. Interactive Advisors – Best For Automated Investing
  3. Charles Schwab – Best For Self Directed Investing
  4. Sunexchange – Best For Alternative Investments

Top Socially Responsible Investing Platforms in UAE Reviewed

The best trading platforms for socially responsible investing in UAE are reviewed below. 

1. Goparity – Best Crowdlending Platform

GoParity

Goparity is a Portugal-based crowdfunding platform founded in 2017. It allows users to invest in sustainable projects through crowdfunding. Investors only have access to projects that avoid CO2 emissions, create jobs, and have an impact on people. All projects are thoroughly assessed by GoParity before they are placed on the platform.

GoParity has a great track record, with 272 projects funded so far and an average interest rate payout of 5,38%. Other important track record details include a total invested sum of €25,118,315, a user count of 37,479, and 24,236 tonnes of Co2 avoided per year.  

The GoParity platform doesn’t charge any fees. However, a 1% withdrawal fee is charged when investors want to withdraw their funds. All deposits are denominated in EUR.

GoParity Key Features

  • Minimum Investment Required: 5 EUR
  • Projected Returns: Up to 8% annually
  • Public Statistics and Figures Published: No 
  • Mobile App Available: Yes
  • Auto-Invest Feature Available: Yes
  • Secondary Markets Available: Yes
  • Buyback Guarantee: No
  • Open to Investors: Yes
  • Open to Borrowers: Yes

2. Interactive Advisors – Best Automated Socially Responsible Investing Platform in UAE

InteractiveAdvisors

Interactive Advisors is an American Investment Advisor regulated by the Securities and Exchange Commission. It is part of the Interactive Brokers online brokerage service and founded in 2007.

Interactive Advisors allows users to invest in dozens of socially conscious portfolios. These include top performing portfolios that focus on social justice, environmental portfolios aiming to create a better planet, and portfolios that apply responsible management. 

The platform charges asset management fees of 0,08% to 0,75% per year. There are no hidden trading commissions and users can easily upgrade at anytime to an Interactive Brokers account to trade stocks, options, bonds, and other financial assets on their own. Interactive Advisors allows users to have complete control of their investment account. 

Interactive Advisors Key Features

  • Minimum Investment Required: $100
  • Projected Returns: 14,3% – 23,9% annually
  • Public Statistics and Figures Published: Yes
  • Mobile App Available: Yes
  • Auto-Invest Feature Available: Yes
  • Secondary Markets Available: No
  • Buyback Guarantee: No
  • Open to Investors: Yes
  • Open to Borrowers: No

3. Charles Schwab – Best For Self-Directed Socially Responsible Investing

Charles Schwab logo

Charles Schwab is a USA-based brokerage company founded in 1971. The company  is regulated by the Securities and Exchange Commission, is an FDIC member, and is an Equal Housing Lender. 

Charles Schwab allows users to invest in environmental, socially responsible, and governance (ESG) investment products. These products are accessible through individual stocks, ETFs, mutual funds, and managed accounts. Users can choose from over 500 mutual funds and 200 ETFs in total.

Charles Schwab’s trading platforms offer a wide range of investment features including third-party ESG stock ratings, expert guidance are provided, and easy-to-use screening & comparison tools (including Co2 emission data). There is no minimum investment required  to open a brokerage account.

Charles Schwab does not charge any commissions on socially responsible products. A service charge of $25 may apply on broker-assisted investments.

Charles Schwab Key Features

  • Minimum Investment Required: $0
  • Projected Returns: Varies per financial instrument invested in
  • Public Statistics and Figures Published: Yes
  • Mobile App Available: Yes
  • Auto-Invest Feature Available: No
  • Secondary Markets Available: No
  • Buyback Guarantee: No
  • Open to Investors: Yes
  • Open to Borrowers: No

4. The Sun Exchange – Best For Alternative Investments

The Sun Exchange

The Sun Exchange is a peer-to-peer solar leasing marketplace based in South Africa. It was founded in 2015 by Abraham Cambridge and allows users to generate and sell clean energy online. 

The Sun Exchange platform allows users to generate passive income through sourcing solar projects, buying solar cells and earning on solar cell installment projects. The platform provides users with solar project status updates, reports of the clean energy their solar cells generate in kWh, the amount of carbon their solar cells offset (in kg CO2), and the option to receive their earnings in both ZAR and BTC. 

The Sun Exchange has a solid track record of 67 organizations solar powered, 18,652 tonnes of CO2 avoided, and 18,109 megawatt-hours energy generated.

The Sun Exchange requires a minimum investment of one single solar cell ($3,50). The projected expected return rate on investment is over 10%.

The Sun Exchange Key Features

  • Minimum Investment Required: $100
  • Projected Returns: 10%+ annually
  • Public Statistics and Figures Published: Yes
  • Mobile App Available: Yes
  • Auto-Invest Feature Available: Yes
  • Secondary Markets Available: No
  • Buyback Guarantee: No
  • Open to Investors: Yes
  • Open to Borrowers: No

Tips To Help Users Choose The Ideal Platform For Socially Responsible Investing in UAE

The most important criteria for finding a fintech company with the optimal trading platforms for socially responsible investing in UAE are listed below.

  • Investment Products. Platforms with a wide range of potential social investment options should be preferred. 
  • Reputation. Legitimate, licensed, and regulated platforms increase users safety and their chances for profitable investing. Fintech companies with a great number of users, positive user feedback and tier-one licenses should be preferred.
  • Certifications. To guarantee the ethical investment background of the investment company, platforms with appropriate certifications including B Corp should be preferred.
  • Fees. Platforms with competitive overall fees need to be preferred. 
  • ESG/Sustainability Scoring.  Platforms with a higher range of commitment to socially responsible investing should be preferred. This data is often presented in the form of ESG or sustainability scoring. 
  • Minimum Investment. Platforms with a low minimum investment should be preferred.

Top Socially Responsible Investing Platforms Compared

Key features of the top rated platforms for socially responsible investing are compared in the table below.

Key FeatureGoParityInteractive AdvisorsCharles SchwabThe Sun Exchange
Min. Investment Required5 EUR$100$0$100
Avg. Projected ReturnsUp to 8% AnnuallyBetween 14,3% and 23,9% annuallyVaries per financial instrument invested inMore than 10% annually
Publis Statistics and Figures PublishedNoYesYesYes
Mobile App YesYesYesYes
Auto-Invest YesYesNoYes
Secondary MarketsYesNoNoNo
Buyback GuaranteeNoNoNoNo
Open to InvestorsYesYesYesYes
Open to BorrowersYesNoNoNo

What are Socially Responsible Investments (SRI)?

Socially Responsible Investments (SRIs) are investments that are classified as socially responsible because they invest in socially conscious products. Examples of SRIs are individual companies with a great social value, socially conscious mutual funds, and socially responsible ETFs. 

What Is The Difference Between Socially Responsible Investing and ESG Investing?

The key difference between socially responsible investing and ESG investing is that with ESG investing, investors use a specific way of grading investments using environmental, social, and governance key metrics instead of just investing according to a set of moral guidelines. 

How is The Performance of SRI measured?

Key factors that measure the performance of Socially Responsible Investing are listed below.

  • Financial Performance – Financial performance tracks traditional investment metrics like return on investment (ROI), earnings per share (EPS), price-to-earnings ratio (P/E), and total return (including dividend payments). 
  • ESG Performance – The ESG performance is a metric that is only measured from socially responsible investing and includes a company’s performance in relation to environmental, social, and certain governance (ESG) criteria.

There are multiple rating companies that provide ESG ratings to enterprises, including MSCI, Sustainalytics, and Bloomberg. Investors can compare these ESG ratings to find the right investment more easily.

Does SRI Compromise on Returns?

Based on the research of Arabesque Partners, socially responsible investing does not compromise on returns. Companies with environmental, social, and governance (ESG) investment focus often have better long-term investment returns and lower risk exposure than non-SRI companies. Furthermore, these investments tend to be less vulnerable to market volatility and regulatory changes, which increases the chances of investment success.

What are ESG Factors?

ESG (Environmental, Social, and Governance) are three key factors of sustainable and responsible investing (SRI). The three main ESG factors are listed and explained below.

  • Environmental factors: consider a company’s performance in relation to its impact on the environment. Environmental factors include energy use, waste, pollution, and conservation of natural resources. They also consider environmental risks taken in their supply chains. 
  • Social factors: consider a company’s employee, customer, and supplier relationships. Additionally, the effect of company’s products or services on customers’ overall health is considered.
  • Governance factors: consider a company’s governance factors, such as leadership, executive salaries, internal controls, shareholder rights, and overall corporate governance transparency. 

What Are The Most Popular Types Of SRI In UAE?

The most popular socially responsible investments include SRI Funds, ESG ETFs, Green Bonds, Impact Investments, Community Investments, Shareholder Advocacy, and Social Venture Capital.

Conclusion

Socially conscious investing is a popular way in the UAE to combine financial growth with achieving positive social or environmental impacts. However, the various providers on the market require users to compare, review and filter a large amount of information to find a suitable option for their needs.

For this guide, we have worked hard to keep our readers safe and informed by comparing, evaluating, and reviewing the services of fintech’s accepting UAE clients. The results of our analysis are a list of the best socially responsible trading platforms in the UAE, summed up in the table below.

RANKBROKERPLATFORM SCOREBEST FORWEBSITE
#1Goparity4,9/5OverallOfficial website
#2Interactive Advisors4,9/5        Automated InvestingOfficial website
#3Charles Schwab 4,9/5        Self Directed InvestingOfficial website
#4Sunexchange4,5/5        Alternative InvestmentsOfficial website

FAQ

What Are The Most Common Types of SRI Strategies among UAE Investors?

The most common SRI strategies include negative screening (excluding certain sectors or companies), positive screening (selecting companies with positive ESG performance), and impact investing (investing in companies or projects with a direct social or environmental impact).

What Is The Best Way to Avoid “Greenwashing”?

The best way for investors to avoid “greenwashing” is through detailed research using reputable rating sources including MSCI, Sustainalytics, and Bloomberg.

What Are The Most Common Ways to Make Socially Responsible Investments in UAE?

The three different ways to make socially responsible investments are: SRI ETFs, SRI mutual funds and direct investment in companies with a social background.

Are socially responsible investments legal in UAE?

SRI are regulated the same way as other types of investments and are legal in the UAE.

Which regulatory authority in the UAE certifies whether an investment is socially responsible?

There is no regulatory body in the UAE that certifies socially responsibility of investments. However, there are various entities in UAE including the Dubai Financial Market (DFM) that promote and check social compliance of offered investments.

How do SRI’s perform compared to traditional investments?

Recent research shows that socially responsible investments perform comparably or outperform traditional investments because of their strong management and better equipment to tackle social and environmental challenges.

Disclaimer

eToro is a multi-asset investment platform. The value of your investments may go up or down. Leveraged and speculative product. Not suitable for all investors. You should consider whether you can afford to take the high risk of losing your money. Capital is at risk. Past performance is not an indication of future results. Trading history presented is less than 5 complete years and may not suffice as basis for investment decision. Copy Trading does not amount to investment advice. The value of your investments may go up or down. Your capital is at risk. Crypto assets are unregulated& highly speculative. No consumer protection. Capital at risk.
eToro USA LLC does not offer CFDs and makes no representation and assumes no liability as to the accuracy or completeness of the content of this publication, which has been prepared by our partner utilizing publicly available non-entity specific information about eToro.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site is registered on wpml.org as a development site.