Socially responsible companies are businesses that integrate social and environmental considerations into their core operations and decision-making processes. One of the key characteristics of socially responsible companies is their focus on environmental stewardship and they actively work to reduce their environmental impact by implementing sustainable practices, reducing waste, conserving resources, and minimizing carbon emissions.
Another important aspect of socially responsible companies is their focus on social equity. These companies promote fair labor practices, support community development, and respect human rights. This includes providing fair wages, safe working conditions, and opportunities for employee growth and development.
Ethical governance is also a cornerstone of socially responsible companies. They maintain high standards of transparency, accountability, and integrity in their operations and decision-making processes. This includes ethical business practices, fair competition, and responsible marketing.
Investors are drawn to socially responsible companies because of the alignment with their personal values. Many investors are driven by a desire to make a positive impact on society. By investing in socially responsible companies, they can support businesses that share their values and contribute to social and environmental causes they care about.
The global shift toward sustainable investing is gaining significant traction. The Sustainability Megatrends Report by Cushman & Wakefield highlighted that 60% of global investors reported higher performance yields from Environmental, Social, and Governance (ESG) investments. This positive financial outcome is driving a surge in demand for ESG funds, with 78% of investors willing to pay higher fees for these products. One of the most significant trends is that Institutional investors are increasingly recognizing the financial advantages of ESG-focused investments, leading to a transformation in how companies allocate capital. Therefore, strong ESG performance is becoming a critical factor in attracting investment, with companies that excel in this area seeing a surge in capital inflows.
Mandatory ESG reporting is another critical trend, as governments and regulators worldwide are enforcing greater transparency in environmental and social impact metrics. Companies that integrate these reporting standards into their strategies are better positioned to manage risks and seize new opportunities. The global energy transition and decarbonization efforts are also reshaping industries, with companies investing heavily in renewable energy and implementing strategies to reduce their carbon footprints.
Investors are increasingly drawn to socially responsible companies due to the potential for risk mitigation, long-term value, and alignment with personal values.
Is Salesforce, Inc. (CRM) the Best Socially Responsible Stock to Buy According to Hedge Funds?
A customer service team in an office setting using the company's Customer 360 platform to communicate with customers.
Our Methodology
To compile our list of the 8 best socially responsible stocks to buy according to hedge funds, we sifted through internet rankings to find 20 socially responsible companies. We then used Insider Monkey’s Hedge Fund database to rank 8 stocks according to the largest number of hedge fund holders, as of Q3 2024. The list is sorted in ascending order of hedge fund sentiment.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Salesforce, Inc. (NYSE:CRM) is a leading customer relationship management (CRM) platform that provides cloud-based solutions for sales, marketing, and analytics. The company’s comprehensive suite of products, including Sales Cloud, Service Cloud, Marketing Cloud, Commerce Cloud, and Slack, is designed to provide a 360-degree view of the customer, enabling businesses to enhance customer engagement, streamline operations, and drive growth.
Salesforce, Inc. (NYSE:CRM) is revolutionizing the way businesses operate with the introduction of Agentforce, a groundbreaking AI-powered platform that transforms customer service and support. Agentforce leverages autonomous AI Agents to handle customer interactions with unparalleled accuracy and efficiency. This not only reduces the workload on human agents but also enhances the overall customer experience. By automating routine tasks and providing real-time insights, Agentforce is unlocking new levels of productivity and operational excellence. Companies such as Vivint and Adecco are already seeing significant benefits from adopting Agentforce, with Vivint resolving service cases 40% faster and Adecco processing 300 million job applications annually with unprecedented speed and accuracy.
Salesforce, Inc. (NYSE:CRM) is expanding its footprint globally, with a particular focus on highly regulated industries such as healthcare, manufacturing, and automotive. The company’s industry-specific solutions, such as the new Life Science Cloud, are tailored to meet the unique needs of these sectors.
Overall, CRM ranks 3rd on our list of the best socially responsible stocks to buy according to hedge funds. While we acknowledge the potential of CRM as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than CRM but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
