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"80% [of investors] are interested in sustainable investments that can be customized to meet their interests and goals."
--
Morgan Stanley
   (USA) August 2017

"The vast majority of Canadian investors are interested in responsible investments (RI) that incorporate environmental, social and governance (ESG) issues, and they would be more likely to choose responsible investments if their financial advisor suggested suitable RI options for them."
--
Responsible
    Investment
    Association (RIA)
 
  (Canada) June 2017

"70% of people [in UK] want to invest ethically but the financial services industry is failing to respond." Referencing research by Abundance.
--
Acquisition
    International
   
(UK) June 2015

 

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Links may only be valid for a limited time   October 17, 2017

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PRI threatens to strip members of signatory status in 'greenwashing' purge. "The PRI argued that many of the 200 or so asset managers and schemes that have signed up to the United Nations-backed principles on tackling environmental, social and governance (ESG) issues pay little more than lip service to them. Now they will be faced with a new set of standards to prove they are making active efforts to effect change, or they risk being removed from the PRI's official list of signatories."

[COMMENTARY] The UN Principles for Responsible Investment (PRI) have been talking about doing this for some time. I'm delighted to see it happening.
PRI threatens to strip members of signatory status in 'greenwashing' purge, by James Phillips, October 16, 2017, Professional Pensions, UK.

'True Bearing' Financial Planners Unveil Consumer Attitudes Towards Sustainable Investment. "With 32.9% wanting to invest in ESG/sustainable investments, why do actual investments total only 3%? Using the survey results, the 3% of total UK assets managed should increase many times over. These figures suggest that IFA's are missing out on a large market share, of those keen to take up ESG investments."

[COMMENTARY] This is something I've been talking and writing about for decades! Most financial advisors and planners -- so many different nomenclatures -- are reluctant (or not required) to spend the time to really know their clients. They make a mockery of what should be their 'know thy client' mandate. Also, the time to gain knowledge concerning ethical/ESG investments, commission arrangements, and other impediments, thus lead numerous advisors to offer inappropriate advice to their clients.
'True Bearing' Financial Planners Unveil Consumer Attitudes Towards Sustainable Investment, press release, October 11, 2017, True Bearing Chartered Financial Planners, UK.

Investors fear ESG investment will hurt returns. "Almost half of big European investors fear they will lose out on returns if they invest sustainably, despite the majority believing environmental, social and governance issues will become increasingly important over the next five years."

[COMMENTARY] Schroders definitely sees the future in ESG investing and is taking it seriously. The research they're compiling -- and its results -- is spurring increasing attention throughout the investment industry. Investment industry professionals should note the results of the study below that just won this year's Moskowitz Prize!
Investors fear ESG investment will hurt returns, by Attracta Mooney, October 11, 2017, Financial Times, UK.

Announcing the 2017 Moskowitz Prize Winner for Sustainable and Responsible Investing. "This year, the Moskowitz Prize acknowledged the superior quality of the paper Corporate Governance and the Rise of Integrating Corporate Social Responsibility (CSR) Criteria in Executive Compensation: Effectiveness and Implications for Firm Outcomes released in September 2017. The study examined the integration of CSR contracting – that is the linking of executive compensation to social and environmental performance – and how it affects firm-level outcomes.

'This study provides practitioners of sustainable, responsible and impact (SRI) investing with data that shows how companies that do good also perform well,' said Steve Schueth, producer of The SRI Conference and president of First Affirmative Financial Network. 'The authors' findings add to the mounting evidence that investing in companies that integrate sustainability best practices into their operations does not hinder financial performance, but can improve it – especially for their long-term investors.'"

[COMMENTARY] I've given a lot of space to this study because it's important for many reasons. Firstly, the Moskowitz Prize offered by the Center for Responsible Business at the Haas School of Business, University of California, Berkeley, has become THE prize for SRI/CSR researchers globally. Secondly, the winner of this year's prize uniquely demonstrates the advantages of CSR for company executives and stockholders!
Announcing the 2017 Moskowitz Prize Winner for Sustainable and Responsible Investing, press release, October 10, 2017, SRI Conference and The Center for Responsible Business at the Haas School of Business, UC Berkeley, USA.

UK Good Money Week October 8-13, 2017. "Letting people know they have sustainable and ethical options when it comes to their banks, pensions, savings and investments so we can protect the environment and support society when we deposit and grow our money."

[COMMENTARY] The UK also has its yearly ethical-responsible money/investing week too. Again, I encourage all UK investors and investment professionals to take this opportunity to help grow UK ethical-responsible finance and investment. These 'weeks' garner greatly increased media attention to these endeavors as well.
UK Good Money Week October 8-13, 2017, Good Money Week, UK.

Responsible Investment Week Canada Events October 23-27, 2017. "The Responsible Investment Association (RIA) is coordinating a week of events across Canada to promote learning about environmental, social, and corporate governance (ESG) issues that affect investments."

[COMMENTARY] I encourage Canadian investors and investment professionals to take part in these events! It's a terrific opportunity to encourage the adoption of ethical, sustainable, responsible investing. For a listing of events see Responsible Investment Week, Make Money, Responsibly, Canada.

Major asset managers moving slowly but surely toward impact investing. "Nine out of the top 10 largest U.S. asset managers are now active in impact investing, according to new Tideline analysis. All but Vanguard, the second largest US asset manager, have stood up or are actively testing impact investing strategies."

[COMMENTARY] impact investing continues to grow, largely due to the demands of high net worth investors says this survey. Also, this survey found that institutional investors are laggards in this area.
Major asset managers moving slowly but surely toward impact investing, by ImpactAlpha/Kim Wright-Violich,  October 3, 2017, Tideline & ImpactAlpha, USA.

100 Women: Do women on boards increase company profits? "More sophisticated pieces of analysis carried out by academics have shown very small positive correlations between female board members and financial success. But this is an average - in some companies the relationship was neutral and in some it was negative. And proving causation is far harder."

[COMMENTARY] Ethical investors are convinced that having women on boards improve corporate financial performance. Studies support that thesis. However, this article cites some research contradicting that finding. So, who's right? As in most social science research, results can differ greatly between studies.
100 Women: Do women on boards increase company profits? October 2, 2017, BBC News, UK.

Research preoccupied with short-term financial metrics. "Excluding environmental, social and governance issues leads to misallocation of capital... A global survey of 342 financial analysts by Aviva Investors found that 42 per cent of respondents thought research published by banks and brokers was preoccupied with short-term financial metrics."

[COMMENTARY] Interesting, aren't these the analysts that publish the research? Yet, they're the ones criticising themselves of a short-term preoccupation and avoidance of ESG measures they know are important for understanding the long-term financial prospects of companies! At least they know their issues. Perhaps it's their managers that need to get with it!
Research preoccupied with short-term financial metrics, by Chris Flood, October 1, 2017, Financial Times, UK.

Candriam: ESG analysis deems 49 countries 'non-investable.' "China, Russia and Turkey are among 49 countries that are 'non-investable', according to an analysis of their potential for long-term sustainable development by Candriam. Of the 35 advanced economies analysed – based on the definition used by the International Monetary Fund – only Greece came out as non-investable. Out of the 88 emerging economies, 48 were classified as non-investable."

[COMMENTARY] Candriam have completed a fascinating analysis of investible countries based on ESG criteria. What is especially interesting is that this analysis applies to both equity and bond investing.
Candriam: ESG analysis deems 49 countries 'non-investable, by Susanna Rust, September 29, 2017, IPE, UK.

The global rise of sustainable investing -- Schroders. "To accurately gauge the latest attitudes, we surveyed more than 22,000 people from 30 countries who invest. We asked them about their knowledge, views and actions when it comes to sustainable investing."

[COMMENTARY] Schroders survey of global sustainable investing provides some useful insights for all investors, particularly supportive for ethical investors. However, the self-reporting of those surveyed saying that most of them are already investing in sustainable ways is questionable. As we know, what people say and actually do aren't always the same! Nonetheless, it does show that sustainable investing is increasingly important to investors.
The global rise of sustainable investing -- Schroders, September 27, 2017, Schroders, UK.

China’s sustainable firms are starting to outperform. "Chinese companies that disclose their environmental, social and governance measures are outperforming on the stock market, data show."

[COMMENTARY] There's been little evidence to date of Chinese corporate ESG stock performance. This new data is probably the first to indicate that possibility. Companies ESG outperformance and correlated stock outperformance appear to be a worldwide phenomenon. Most ethical investors have probably avoided China so far, but data like this could change that.
China’s sustainable firms are starting to outperform, by Karen Yeung, September 27, 2017, South China Morning Post, China.

[UK] Consultants pressure pension funds over ethical investment. "Twelve large investment consultants have joined forces to increase pressure on pension funds that are not taking environmental, social and governance (ESG) factors into account when making investment decisions.

The group of consultants, which includes the big three of Willis Towers Watson, Mercer and Aon Hewitt, advise on close to £1.6tn of pension and insurance assets in the UK alone and have huge influence over the investment decisions of asset owners."

[COMMENTARY] This is great news. However, they're taking this action because the UK government's pension regulator says, according to the FT, that, "savers face long-term financial risks because trustees are failing to take climate change, responsible business practices and corporate governance into account when making investments."
[UK] Consultants pressure pension funds over ethical investment. by Aliya Ram, September 23, 2017, Financial Times, UK.

Canadian Money Saver publishes an article, "Do-It-Yourself Ethical Investing Pays," by Ron Robins. "Though DIY sustainable-ethical investing requires some work it can pay handsomely. The process is engaging and fun too. But the skills to do it effectively can be more quickly acquired with coaching from those experienced in this work."

[COMMENTARY] I wrote this article -- and offer webinars and tutorials on this subject too -- for individual investors who want to have ownership and save on fees in creating and managing a stock portfolio that reflects their personal values.
Canadian Money Saver publishes an article, "Do-It-Yourself Ethical Investing Pays," by Ron Robins, September 2017, Canada.

Catching The Wave: The Spread of ESG in Institutional Investment Portfolios. "More than a quarter of North American institutions use environmental, social and governance (ESG) standards in their investment portfolios, and approximately 60% of institutions that have not yet incorporated ESG into their portfolios say they are open to doing so in the future."

[COMMENTARY] Their study provides some further insights into the spread and utilization of ESG among institutional money managers.
Catching The Wave: The Spread of ESG in Institutional Investment Portfolios, press release, September 19, 2017, Greenwich Associates, USA.

LEGO Group Leads Global Ranking of Best CSR Reputation. "Reputation Institute has released the main findings of its 201 7 Global CSR RepTrak® 100 report, including the list of the companies considered as the most responsible worldwide. The report is based on over 170,000 ratings from interviews with the public in the 15 largest economies (United Kingdom, Spain, Italy, Germany, France, Russia, Brazil, Mexico, USA, Canada, Japan, China, India, Australia and South Korea)."

[COMMENTARY] Their top five are LEGO, Microsoft, Google, Walt Disney, and BMW. Full results here.
Reputation Institute, September 12, 2017, USA.

Ceres launches water use scorecards on affected companies. "For food companies, water management is a business imperative like never before. And as risks of water scarcity and pollution steadily increase, corporate leaders must evaluate the most effective ways to water-proof their business."

[COMMENTARY] Ceres has created an impressive scorecard on how food companies, in particular, use and manage their water resources.
Feeding ourselves thirsty, September 2017, Ceres, USA.

Big investors take aim at banks over climate change risk. "A coalition of institutional investors managing more than $1tn in assets is demanding that 60 of the world’s largest banks take action to protect the world from the threat of catastrophic damage due to climate change."

[COMMENTARY] This was bound to happen -- and good that it has. Financial institutions and companies not reporting or allowing for climate change effects on their businesses will likely see reduced investor interest and possibly lower relative stock prices over time.
Big investors take aim at banks over climate change risk, by Chris Flood, September 14, 2017, Financial Times, UK.

Responsible Investment Week Canada, "make money responsibly." October 23-27, 2017. "Responsible Investment Week is dedicated to education and awareness about responsible investment (RI). The Responsible Investment Association (RIA) is coordinating a week of events across Canada to promote learning about environmental, social, and corporate governance (ESG) issues that affect investments."

[COMMENTARY] All Canadian investors are encouraged to attend and participate in RIA's Responsible Investment Week! The event gets larger every year and the more people that attend the greater the media coverage.
Responsible Investment Week Canada, "make money responsibly." October 23-27, 2017, September 14, 2017, Responsible Investment Association, Canada.

US SIF Foundation Releases Resource Guide For Retail Investors: "Getting Started in Sustainable and Impact Investing." "This resource is a concise guide for retail, non-accredited investors exploring investment options such as mutual funds, ETFs, and direct ownership of stocks, as well as information on seeking professional investment help."

[COMMENTARY] A basic guide for novice sustainability focused investors. It's a useful adjunct to my Tutorial: Creating A Profitable Personal Values-Based Portfolio.
US SIF Foundation Releases Resource Guide For Retail Investors: "Getting Started in Sustainable and Impact Investing," press release, September 14, 2017, US SIF, USA.

Big investors to put more money into tackling climate change. "More than two-thirds of institutional investors are planning to increase investments related to tackling climate change, according to a new survey that suggests 'green finance' is moving from the margins to the mainstream of global markets.... in a study commissioned by HSBC, will add weight to calls from Mark Carney, governor of the Bank of England, and others for greater disclosure of 'climate risks' in the corporate and financial sectors."

[COMMENTARY] How many companies in the insurance, utilities and other hurricane affected industries in Texas and Florida have put as potential liabilities on their balance sheets potential hurricane damages? Though such costs are difficult to assess, but, with climate warming/change becoming increasingly costly for businesses, perhaps investors need to ask such questions more vigorously. Companies refusing to acknowledge such costs might be shunned by investors in years to come!
Big investors to put more money into tackling climate change, by Andrew Ward, September 11, 2017, Financial Times, UK.

Investors Can Be Ethical and Still Beat the Market, Study Says. "Ethical fund managers don’t have to be envious of the market-beating returns of so-called sin stocks. They should be able to match them without dabbling in vice, according to a study in the Fall edition of the Journal of Portfolio Management. The study debunks the popular theory that shares in the alcohol, tobacco, gaming, and weapons industries outperform because investors shun them, enabling those with fewer moral scruples to earn a 'reputation risk premium.'”

[COMMENTARY] So 'sin' stocks only outperform if their profits and investment also outperform. This is an important message, but one I feel will take time to be accepted. Nonetheless, for ethical investors, it's heartwarming to see the results of this study.

Also, as government health care costs continue to explode, many sin sectors such as tobacco and alcohol will continue to be taxed higher and higher, thereby continually eroding the profitability of companies in these sectors. Thus, their future outperformance becomes questionable. See actual study here.
Investors Can Be Ethical and Still Beat the Market, Study Says, by Cormac Mullin, September 11, 2017, Bloomberg, USA.

Rising carbon prices could slash company profits. "The impact of climate change could hit global profits just as hard as the financial crisis and Schroders have launched a new tool to help investors work out which companies will suffer most."

[COMMENTARY] This is an important article to read for all ethical investors. Such research will likely become ever more important to investors as the world grows increasingly concerned about climate change.
Rising carbon prices could slash company profit, by Michelle McGagh, September 6, 2017, Citywire Money, UK.

Sustainable Signals: New Data from the Individual Investor--Morgan Stanley. "80% [of investors] are interested in sustainable investments that can be customized to meet their interests and goals."

[COMMENTARY] Morgan Stanley's Institute for Sustainable Investing has published the results of its second investors' survey. Unsurprisingly, the results show a growing interest in sustainable investing-- especially by millennials.

(Again, for individual investors interested in a do-it-yourself approach, you'll find participating in my free DIY Ethical-Sustainable Investing Webinars very helpful.)
Sustainable Signals: New Data from the Individual Investor, Morgan Stanley Institute for Sustainable Investing, September 2017.

Opinion: The pros and cons of ethical debt instruments. "Innovative debt instruments help to harness the powerful role of capital markets and can connect more savings with international development priorities such as the SDGs. As investor interest continues to soar, they could help move the world from billions to trillions of dollars in financing for the SDGs [Sustainable Development Goals]."

[COMMENTARY] A fine article about ethical-sustainable debt by an advisor to the UNDP.
Opinion: The pros and cons of ethical debt instruments, by Gail Hurley, September 4, 2017, Devex, USA.

Pension funds need to look beyond ESG fund ratings. "These environmental, social and governance (ESG) ratings 'do not tell the whole story' and each set can provide very different conclusions for the same companies, the investment manager [Kames] argued."

[COMMENTARY] I think most investors are aware of the above. That's why some might want to add a do-it-yourself approach and hence my new and free Introductory DIY Ethical-Sustainable Investing Webinars. The next webinars are Saturday, September 30, 4 pm EST and Tuesday, October 10, 7 pm EST. All are welcome.
Pension funds need to look beyond ESG fund ratings, by James Phillips, August 31, 2017, Professional Pensions, UK.

Why FAs Are Still Reluctant to Jump on ESG Bandwagon. "Asset managers and major brokerages think there’s big money to be made shilling these funds to advisors, with the likes of BlackRock, Bank of America and UBS highlighting the growing acceptance and mainstream popularity of SRI and 'impact investing' strategies. But many advisors don’t seem to be biting. A survey of advisors from the Financial Times’ list of top RIAs last year showed just 4% of firms were focused on SRI opportunities."

[COMMENTARY] Advisors in this piece argue there's little demand by clients for SRI products. However, I wonder if they even ask their clients about potential interest in SRI/ESG investing? In most investor-advisor surveys the advisors fail to ask that question.
Why FAs Are Still Reluctant to
Jump on ESG Bandwagon, by Murray Coleman, August 16, 2017, Financial Advisor, USA.

The Carbon Clean 200 2017 Q3 Update is now available. "A growing movement of investors representing more than $5.2tn in assets under management have signed a pledge to divest some portion of their fossil fuel holdings. But where to invest this capital?

The Clean200 list ranks the largest publicly listed companies by their total clean energy revenues, with environmental, social, and governance screens to help ensure the companies are indeed building the infrastructure and services needed for the 'Great Energy Transition' in a just and equitable way. Notably, this new report highlights the fact that clean energy investments greatly outperform stagnating fossil fuel stocks."

[COMMENTARY] The Clean 200 is an important listing for ethical investors of the leading carbon clean companies globally. Perhaps one of the most surprising findings is that China leads with 68 companies, double that of the USA!
Click here for The Carbon Clean 200 2017 Q3 Update, August 15, 2017, Corporate Knights/AS YOU SOW.

Millennials are driving a $9 trillion change in investing. "Millennials are driving the nearly $9 trillion sustainable investing market, according to a survey of 1,000 investors by Morgan Stanley's Institute for Sustainable Investing."

[COMMENTARY] Morgan Stanley's research confirms the results of other surveys. (And still, too many advisors and brokers aren't aware of this.)
Millennials are driving a $9 trillion change in investing, by Frank Chaparro, August 10, 2017, Business Insider, USA.

20 Undervalued, Sustainable Stocks -- Morningstar. "We screened the Morningstar US Sustainability Index to find some undervalued stocks that score well on ESG metrics. Sustainability assessments are provided to Morningstar by researcher Sustainalytics (of which Morningstar has a 40% ownership stake)."

[COMMENTARY] I'm delighted to see that Morningstar is starting to freely share some of the individual Sustainalytics stock ratings. This is good news for all investors who don't have access to Sustainalytics individual stock ratings' services.
20 Undervalued, Sustainable Stocks -- Morningstar, by Karen Wallace, August 9, 2017, Morningstar, USA.

The race to embrace ESG ratings. "Major investment firms are snapping up environmental, social and governance (ESG) ratings companies at a rapid clip — three hookups within just the past year."

[COMMENTARY] It's to be expected that many of the rising ESG raters would be acquired by somewhat related and established firms. It demonstrates ESG's coming-of-age. Is it good or bad for investors? Only in five, ten, or more years will we know.
The race to embrace ESG ratings, by Anya Khalamayzer, August 10, 2017, GreenBiz, USA.

More Evidence of Solid Performance From Sustainable Funds. "Investors in funds that incorporate environmental, social, and governance factors into their process appear not to suffer a performance penalty."

[COMMENTARY] Morningstar's Jon Hale has another insightful post reviewing the recent performance of ESG funds. And he says these funds continue to demonstrate good relative performance.
More Evidence of Solid Performance From Sustainable Funds, Jon Hale, August 3, 2017, Morningstar, USA.

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Disclaimer: This website does not make investment recommendations. Nothing in this site should be interpreted as a recommendation or solicitation to buy/sell any securities or investments. Investing for the Soul is a source of general information and resources for ethical investing and socially responsible investing (SRI). Investors should consider their actions thoroughly and consult their financial advisers and other professionals, prior to taking any investment action. This website does not necessarily agree with the opinions expressed in articles on its pages or offered on the web pages to which it might be linked. Such opinions are the responsibility of the writers themselves. Furthermore, this site does not offer or provide any warranties, representations, guarantees, implied or otherwise, as to the accuracy, legality, copyright compliance, timeliness or usefulness of the information, materials or services on this, or other sites, to which it is linked. Also, Mr. Ron Robins is not an investment advisor, nor is he licensed with any professional investment related body, and thus is not able to, nor does he make, any investment recommendations.

 

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