In an analysis of "ethical mutual funds," which invest in "socially responsible" companies and control about $639 billion worth of investments, Fortune magazine reported that these funds produced an 18.2 percent return over the previous year, compared with the S&P average rate of 27.2 percent—a total loss of $57.5 billion to their investors.

While the funds no doubt perform poorly due to the relatively unprofitable nature of the companies targeted for investment, they are also the focus of an unusual amount of litigation. Vigilant, progressive-minded investors apparently have a strong tendency to sue whenever they discover their money is directed towards companies they consider irresponsible by some measure—such as their percentage of women and minority board members or whether they do business with repressive regimes—even those firms the presumably idealistic money managers consider socially responsible by other measures.

[Ed.: Mutual funds that earn nine percent under average are, by definition, socially irresponsible.]

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