Councillor Ros Jackson (Labour), who represents Louth Trinity ward, wants ELDC to make “no future direct investments” in fossil fuel, tobacco or arms industries and stop any existing investments in the next year.
A council spokesman confirmed the authority does not have any such investments, with most of its money in banks and building societies.
However, Coun Jackson says her “pre-emptive” motion, will ensure it “stays on the right track”.
She continued: “This motion is important because the council should be investing in ways that bring benefits to residents not only in monetary terms, but also in social and environmental ones.
“We want healthy and prosperous residents, and this is a way to make sure council investments maintain those aims without creating a conflict of interest.
“East Lindsey District Council needs to put its money where its values are.”
The motion has been seconded by Coun David Hall (Labour), who represents the Louth North Holme ward.