Advocates for the world's poor see a golden opportunity for investors to make money and champion social justice at the same time by raising their voices as shareholders in gold-mining companies.

But encouraging best mining practices through investing is apt to require an uncommon level of creativity. The reason: America's socially responsible (SR) mutual funds aren't joining the effort, which means US investors eager to make a difference may need to find other avenues.

At issue are massive earth-moving enterprises to extract the precious metal from deposits in some of the world's most remote places. The chemical-intensive process has left some ugly marks in recent years, such as cyanide-contaminated rivers in Ghana, pollution resulting in criminal charges in Indonesia, and throngs of angry protesters in Peru.

Now high gold prices, which topped $1,000 per troy ounce for the first time this month, are rewarding investors – and providing an economic rationale for new mining initiatives in lands never before touched by heavy equipment.

"Because the price of gold and other metals is so high," says Keith Slack, extractive industries program manager at Oxfam America, an antipoverty group, "and there's such a demand for those products, mining companies are going into more and more developing areas in Latin America, Africa and Asia.

"Investors can play an important role [by saying] they want to see these operations done more responsibly," Mr. Slack continues, "by taking into account the environment and concerns of the local community."

Some institutional investors are being proactive. Admin­istrators of New York City pension funds have called on gold giant Freeport McMoRan to improve its policies in the wake of reports of bribery and other misdeeds involving its sec­­urity forces in Indonesia.

"We have industry-leading human rights practices," responds Freeport-McMoRan spokesman William Collier via e-mail, "yet seek to continually improve our performance."

Christian Brothers Invest­ment Services, which invests funds for Roman Catholic institutions, last year won support from 92 percent of Newmont Mining shareholders for a resolution urging an investigation of the causes of rifts with multiple indigenous communities. (A report is expected later this year.)

And in Canada, Vancouver-based Ethical Funds is bringing social concerns of its Canadian investor base to the boardrooms of Gold Corp. and Barrick Gold, the world's largest gold producer.

"This is a rapidly evolving field," says Bob Walker, vice president for sustainability at Ethical Funds. "There's a lot to respond to here, on both the human rights side and the finance side, and we think [companies] need to move as quickly as possible.… We hope they'll come to view us as a resource on these issues."

American SR funds, however, are taking a hands-off approach. Jay Falk, president of research firm SRI World Group, says via e-mail that he knows of no US-based SR funds taking an active role in gold-mining issues. That's because gold-mining firms seldom pass an SR fund's social screens due to their checkered track records.

"We see a large business concentration in gold as a serious negative for a company," says Jeff MacDonagh, SRI portfolio manager for Domini Social Investments. "Most of these companies have pretty serious environmental and employee safety problems.… It becomes pretty difficult for an investor who cares about environmental and social issues to hold a company with big interests in gold."

Debate: Avoid bad companies, or try to reform them?

These divergent approaches reflect a longstanding debate within SR investing: Is it better to keep problematic sectors and companies out of a portfolio, or invest with hope of persuading them to do better? Activism has recently been gaining favor: Shareholders last year filed 68 percent more resolutions on social issues (368) than they did in 1999 (219), according to Washington, D.C., research firm RiskMetrics. But gold-mining stocks seem to remain too problematic, too high-priced, or both to inspire SR investment.

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