Look at the list of large, well-known fund providers that offer a socially responsible investment product and the first thing you'll notice is that the list is short. Very short.

Of the 192 funds that screen investments using labor, environmental and social concerns, the only larger firms that offer the products are Vanguard, TIAA-Cref, Dreyfus, Smith Barney and Neuberger Berman. Noticeably absent from the list are the likes of American Century, Fidelity Investments and Prudential, according to fund researcher Morningstar. Those powerhouses are known to use vast economies of scale to market to broad audiences and, therefore, their products are mostly mainstream, consumer vehicles.

But there is plenty of speculation-and differing opinion-about when and if larger fund complexes will enter the SRI space. Some say the products have hit the mainstream and can't be ignored by industry giants for long. Others say the niche product, although here to stay, will likely be a small-time venture for mostly small-time shops.

Historically, SRI funds have been the work of those relatively smaller firms, the most notable of which is arguably Domini Social Investments. In ten years, the firm has grown its social equity product to $2 billion in assets. Other notable players have been Calvert and PAX, which launched what is known as the first SRI fund in 1971. In addition, both Calvert and Domini have established themselves by developing well-known social indexes, which are often versions of mainstream indexes that screen out socially questionable equities.

Bigger Players Moving In

Many of the smaller players expect larger firms to start or acquire SRI funds soon, even despite the fact that this niche product doesn't afford much in the way of economies of scale. "SRI has only now been a product of the mainstream, so I think we'll see a lot more large fund complexes going into the SRI space in a couple of years," said Domini President Sigward Moser. "TIAA-CREF and Vanguard is only the beginning."

And during a recent press conference in New York, Pax World Funds President Thomas Grant said of the larger firms: "We think they'll recognize the growth down the road and consolidate with other SRI players."

Moser even welcomes the competition. Giant firms, with their lush distribution channels, are likely to expand the SRI market should they join it, he said. "This is an encouraging thing for us," he said. "This is going to help us increase the size of the pie. We'll be perfectly fine having a smaller percentage in a larger market if our percentage is getting larger."

Steering Clear

But Geoffry Bobroff, a well-known consultant says giants of the industry are likely to steer clear of SRI. "I don't think there is investor demand," he says. And most portfolio managers are likely to see the social-screening concept, which often involves a panel of experts in environmental and social fields, as "counterintuitive," and "artificial," Bobroff said.

Sure, investors will use SRI products if they're available, he said, but those investors aren't "beating down the door for socially screened products." The fuss about SRI is in large part due to journalist hype (Domini, for example, has seen coverage that would make a congressman blush) and the fact that SRI funds benefited from wading deep into technology stocks before that sector imploded, he said. As of July 30, SRI products made up only 2.4% of all long-term assets, Bobroff said. "Which is to say, it gets a lot of ink, but for the bottom line of the industry, it ain't much."

Of the well-known firms that have entered the space, most have done so during the past five years, said Catherine Hickey, a Morningstar analyst who specializes in SRI funds. The exceptions are Dreyfus, perhaps the first major-complex entrant, which launched the Dreyfus Premier Third Century Fund in 1972, and Smith Barney, which launched its Social Awareness Fund in 1987.

Bringing Up the Rear

The most recent entry, Hickey said, was Vanguard. That firm started its Vanguard Calvert Social Index Fund, which mirrors the Calvert index, in late May of last year.

The fund is off to a rocky start. For one, it launched in the midst of this protracted market slump and has only garnered some $84 million in assets, said spokeswoman Rebecca Cohen. For another, the Calvert Index, like many other SRI products, is weighted in the beleaguered technology sector, mainly because software and computer-related companies are known to be environmentally friendly. Those tech stocks have been an albatross around the neck of the Vanguard fund.

Cohen said Vanguard is "certainly not timing markets when we offer a fund," and said the firm basically launched the product with no real expectations, because of consumer demand. She added that Vanguard had considered offering an SRI product for several years and finally did so after investors, especially those using 401(k) plans, asked for one.

But, asked whether she thought the Vanguard SRI product would attract more assets in better markets, Cohen demurred. "I don't think I can predict that," she said. "Certainly we hope there would be interest in the fund, but I don't think we should try to make any predictions which way the fund will go."

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