Archive for the ‘Sustainable Investing’ Category

A guide to ethical investing

Wednesday, April 6th, 2011

By Kate Saines

Published at Myfinances.co.uk

When deciding where to invest our money, our biggest priority is naturally finding a product which provides the highest returns.

But for a growing number of investors, knowing the money is going to be beneficial to not only the company whose shares we are buying but to the sustainability of the planet is just as essential.

With household spending on ethical goods and services tripling in the past ten years, according to the Co-operative Bank, it will come as no surprise to hear that sales of ethical funds are now rising too.

So, if you are keen to invest some money but you want to do so responsibly here’s our guide to ethical investments.

Read the full article: A Guide to Ethical Investing

Private Social Investment in France: Meeting Two Goals

Thursday, January 27th, 2011

Socially Responsible Investing in France has taken off much like in the rest of the world.  Several students from the Wharton Business School authored an article that discusses the two styles of private socially responsible investing that have gained notoriety in France.

We typically focus on publicly traded companies and there were some facts in this article of note.

“At the end of 2009, social investing in France reached €4 trillion (US$5.7 trillion) after nearly doubling between 2005 and 2008. The dominant investment vehicles in this field are socially responsible index funds.”

“According to Novethic, an affiliate of government pension fund manager Caisse des Dépôts, social investing in France is still in its fledgling stage, but it has been encouraged by French legislation that promotes social investing, such as a regulation requiring pension funds to invest at least 10% of their assets in socially conscious projects.”

Read the full article: Private Social Investment in France: Meeting Two Goals

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Impact Investing — Using Green Thinking to Make Green Dollars

Tuesday, January 25th, 2011

April Rudin writes for the Huffington Post:

Impact, socially responsible or sustainable investing has slowly crept onto the investment scene as an alternative asset class. But it has gained attention, in part, to mitigate the bad karma created by Madoff and others, non-transparency of investments, the recession, low interest rates, a depressed economy, and high unemployment. Socially responsible investing is the feel-good asset class. It’s the intersection of banking, philanthropy and Wall Street. Investors are shunning ‘get rich’ firms who are ruining our planet. Upcoming Gen-X and Gen-Y investors and their dollars want to make a difference. It will therefore be a growing social community of like-minded investors.

Simultaneously, increasing numbers of high net-worth individuals, wealth managers, institutional and other investors want to “doing good while doing well.” These individuals are of the baby-boomer generation. Some have been late adopters and doubted the “depth” of this movement but clearly there is groundswell among those who want to generate return either partially or even wholly through funds or direct investments. This has led to the creation of boutique Wall St. firms which zero in on this specialization and larger financial institutions have creating small teams to focus on locating, understanding and vetting investment opportunities. As it is early, there is still conversation over whether or not impact investing is indeed an asset class or an underlying strategy which will be eventually used in all products.

Read the complete article: Impact Investing — Using Green Thinking to Make Green Dollars

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Sustainable business success through corporate social innovation

Tuesday, January 4th, 2011

In an article for eco-busness.com, Tania Ellis writes:

Today’s business world is a world of disorder. Global mega crises ranging from security threats, global warming and the depletion of natural resources to food shortage and the growing gap between the rich and the poor, as well as higher personal levels of stress are changing companies’ freedom to operate, their reputations and brand value, the cost of capital and perceived investor risk.

According to Ellis, this reality is leading to the following investment trends throughout the world:

  1. Socially responsible investing (SRI) is increasing the attention on corporate social and environmental practices by identifying companies that benefit society.
  2. Large pension funds around the world are already using screening agencies to assess how companies tackle so-called ESG (environmental, social, governance) issues.
  3. Since the 2008 financial crises the number of large investment managers and private equity firms signing on to the UN-backed initiative Principles for Responsible Investment (PRI) has more than doubled. These signatories manage a total of $18 trillion in assets.
  4. As a result of the growth of SRI, companies are increasing reconfiguring their way of doing business by seeking profits through responsible and sustainable actions.

 

To learn more, read the article: Sustainable business success through corporate social innovation

Green Expectations

Wednesday, December 1st, 2010

Hannah M. Muralla reports for Business World

A good chunk of the globe’s biggest businesses are also, quite unsurprisingly, its most infamous polluters.

Data from the United Nations Environment Programme (UNEP) Finance Initiative and UN-backed Principles for Responsible Investment (PRI) cited that the world’s top 3,000 companies were responsible for $2.15 trillion worth of environmental damage in 2008, with utilities, oil and gas producers, and industrial metals and mining firms cited as the biggest culprits in the industry.

That figure could swell to $28 trillion in 2050 if no concrete steps are taken to curb greenhouse gas emissions, unsustainable resource use, and water and air pollution.

The environment, stressed UNEP Finance Initiative executive director Paul Clements-Hunt, is also the business of businesses. “Using our natural assets efficiently entails collective action…The bottom line is that if we are to achieve a sustainable global economy, we must stop drawing down our natural capital,” he said.

Read the full story Green Expectations at BusinessWorld Online

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Ecumenical Council in London calls for Churches to take lead in investing for a better future

Friday, November 19th, 2010

The Ecumenical Council for Corporate Responsibility (ECCR), a church-based investor coalition working for economic justice, human rights and environmental sustainability, called for churches to align their investments with their mission and values, at a meeting in London yesterday.

Entitled ‘Positive Impact Investment: Too Good to Be True?, financial experts at the meeting debated whether sustainable approaches to capital allocation are the shape of investment to come or likely to remain a niche sector. They concluded that the strength of the capitalist system to mobilize capital creates a huge opportunity  for positive impact investing to create a better world, and that these opportunities will only continue to grow.

As an ECCR spokesperson put it:

In the wake of the financial crisis, the speakers agreed that there is more need than ever for churches and responsible investors to appreciate the risks we run if we do not take into account the social and environmental consequences of investment decisions. BP’s loss of value following the Gulf of Mexico oil disaster was a classic case in point. Companies and fund managers who ignore social issues such as child labor equally run major risks.

The council acknowledged that while ethical and socially responsible investing has increased fourfold in the last decade, it still represents a small percent of  the investment market. But just as the churches have led the way with Fair Trade, meeting members believe they can also play a key role in catalyzing change by  investing sustainably.

For more information read Christians can lead in investing for a better future

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Socially Responsible Investing Surges Following Financial Crisis

Thursday, November 18th, 2010

Socially Responsible Investing has moved from a fringe movement in the 1980’s to the mainstream. Thanks to the financial crisis and heighten concerns over environmental  sustainability, SRI is now the fastest growing investment strategy in the U.S. and Europe.

For many investors the past few years have hammered home the importance of corporate integrity and environmental responsibility. Corporate scandals have lead to the collapse of Wall Street darlings like Lehman Brothers and Bear Stearns, while the biggest oil spill in U.S. history has wiped out billions of dollars in investor value at BP.

Before the crisis began, studies showed a majority of investors already believed companies that operate with higher levels of social responsibility carry less risk (55%) and deliver better returns (52%). The vast number of investors (71%) also contended that knowing a company is rated higher in terms of their social performance would make them more likely to invest in such companies. Yet few managers were willing to incorporate social risks as part of their investment strategy.

Behavior in the investment field is often hard to change, even when there is recognition that treating all stakeholders well is a competitive advantage, not a weakness. The tide, however, is turning. Today, more and more individual and institutional investors are demanding their management professionals implement more sustainable and socially responsible investing strategies. Otherwise they are taking their money somewhere else.

For more insights read Big Money Backs Social Responsibility’s Rise

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SRI assets reach over $3 trillion

Wednesday, November 10th, 2010

Socially Responsible Investing continues to see robust growth despite the market performance over the past 3 years. The Social Investment Forum Foundation said in a report that SRI assets are up 13% from 2006 to 2009. The general market only saw assets grow 3% during the same period. There are over $3 trillion in assets using some form of a SRI strategy. That represents 1 out of 8 dollars being professional managed.

Read more about the Social Investment Forum Foundation’s Report on Socially Responsible Investing Trends in the United States.

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Sustainable Funds Regain Popularity

Thursday, November 4th, 2010

Phil Daivs writes for the Financial Times

It was in the 18th century that John Wesley, a founder of Methodism, gave a definition of socially responsible investment – do not harm your neighbour through business practices, and avoid industries that can harm the health of workers.

More than 200 years later, and after suffering a dip during the financial crisis, investment flows into sustainable and ethical funds are on the rise.

The latest figures from the Investment Management Association, a UK trade body, show that net retail sales of ethical funds totalled £98m in the second quarter of this year – the highest figure since the final quarter of 2007. In the same period last year there were outflows of £8m. The IMA said total assets under management in ethical funds reached £5.6bn, up 22% on last year.

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New Social Standards to Promote Global Sustainable Growth

Tuesday, November 2nd, 2010

The International Organization of Standards (ISO),  a non-governmental network of national standards institutes in 163 countries, has just released a new report entitled ISO 26000: Guidance on social responsibility that provides comprehensive guidelines on issues businesses need to address to operate in a socially responsible manner. The guidelines were developed by representatives from more than 80 countries worldwide. The report is now available on the American National Standards Institution website.

The new standard comes at a time when businesses are being judged on anything from their e-waste disposal, and safety standards, to their carbon emissions and energy efficiency. The new guide provides organizations of all sizes and types with best practice guidance in social responsibility, taking into account societal, environmental, legal, cultural, political and organizational diversity, as well as differences in economic considerations

In the report, ISO Secretary-General Rob Steele states

“Operating in a socially responsible manner is no longer an option. It is becoming a requirement of society worldwide. What makes ISO 26000 exceptional among the many already existing social responsibility initiatives is that it distills a truly international consensus on what social responsibility means and what core subjects need to be addressed to implement it.”

(more…)

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