E-newsletter of Investing for the Soul                                 June 29, 2009

 

Ron Robins, Editor. E-mail /705-635-3034            Latest news at: http://investingforthesoul.com/

Top ethical investing news for June 2009

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News & Commentaries

Links may only be valid a limited time                            Commentaries by Ron Robins  

Dell, Procter and Gamble, Hewlett-Packard, Better Place & Tririga Win 2009 AMR Research Leadership Awards In Sustainability & CSR. - [COMMENTARY] "To determine the list, AMR Research surveyed roughly 50 companies, many of which are part of the Fortune 500. Leaders where chosen based on the following categories of environmental and social stewardship: corporate social responsibility, supply chain innovation, and sustainable leadership including sustainability and innovation, operational sustainable performance, and clean technology." The report makes clear some of the interesting strides that the winning companies have made to sustainability. Ethical investors might want to review AMR's findings.
Dell, Better Place and HP Net Sustainability Awards, by Andrea Nocito, June 1, 2009, Matter Network, reported in Reuters, USA.

Big Companies Still Showing Poor Awareness Of Climate Change Impacts On Their Operations. - [COMMENTARY] "Two new studies from investor group Ceres, the Environmental Defense Fund and the Center for Energy and Environmental Security assess the major impacts climate change could have on global companies, and calls on the U.S. Securities and Exchange Commission to set standards for climate-related risk reporting. The two new studies, one an in-depth look filings from 100 global companies in 2008, and another a longitudinal look S&P 500 companies' reports over the past 13 years, detail how slowly some of the world's largest companies are in recognizing and forming a plan to mitigate the impacts of climate change on business operations."

In reviewing these reports, ethical investors might glean some insight as to whom they feel they are comfortable investing in. It seems that many companies still do not really understand the advantages of using corporate social responsibility. The Ceres and Environmental Defense Fund report actually reviews and comments on individual companies.
Companies Show Little Awareness of Climate Change Risks, Report Finds, GreenBiz, USA.

Harvard Study Shows How Investors Can Determine Long Term Portfolio Risks Due To Labour & Human Rights Activities Of Global Corporations. - [COMMENTARY] "This paper explores how pension funds and other investors can obtain data on the long- term sustainability risks posed by the labor and human rights (LHR) activities of global corporations, with a specific focus on supply chains." This is a precedent setting study and is something that all ethical investors need to pay attention too.
Quantifying Labor and Human Rights Portfolio Risk, by Aaron Bernstein, June 2009, The Labor & Worklife Program at Harvard Business School, USA.

Five Industrial Sectors Risk Losses & Reputational Risk Due To Damaged Ecosystems: EUROSIF. - [COMMENTARY] "The report, entitled Biodiversity Theme Report, addresses risks to the agricultural, extractive, paper and forestry, real estate and infrastructure, and tourism industries. It considers both companies that depend on biodiversity and ecosystem services, and companies whose activities have an impact on biodiversity and ecosystems. The business risks associated with species loss and the restricted functional capacity of ecosystems include decreased availability of resources, the likelihood of regulatory action to protect environmental resources, increased prices and limited access to capital and insurance, an increase in trends toward ecologically responsible purchasing, legal action, and reputational damage." This report is useful reading for all ethical investors.
Damage to Ecosystems Can Lead to Financial Losses and Reputational Risks for Companies, by Robert Kropp, June 10, 2009, SocialFunds.com, USA.

Poor ESG Disclosure In Emerging Markets Deters Major Investors: Survey. - [COMMENTARY] "Approximately 70% of a sample of 67 major asset managers and institutional investors collectively representing $130bn of emerging market investment, told the Emerging Markets Disclosure (EMD) Project, that they wished to see the development of national sustainability indices, ESG listing requirements and greater incorporation by emerging markets companies of global ethical standards and norms before they could commit more money."

A major issue is highlighted here with respect to ethical investors finding stocks that are good to invest in emerging markets. However, S&P, Dow Jones and other index providers are increasingly offering ESG/sustainability oriented indices in these markets. For these indices see my links page, Ethical Investing Stock and Bond Indices.
ESG disclosure holding back 70% of responsible investors from upping emerging markets assets, by Hugh Wheelan, June 22, 2009, Responsible Investor, UK.

Jantzi Research & Maclean's Magazine Pick Canada's Top Socially Responsible Companies. - [COMMENTARY] Jantzi's analysis is always top-notch. Anyone interested in investing in Canada's best socially responsible companies should review this list.
Jantzi-Macleans 50 Most Socially Responsible Corporations, June 18, 2009, Macleans.ca, Canada.

Société Générale, UBS, & Cheuvreux Named As Tops In European SRI & Sustainability Research In 2009 Thomson Reuters Extel Survey. - [COMMENTARY]  This survey is always interesting to look at, most particularly in the light of recent cuts to SRI/ESG research by financial institutions.
Soc Gen named best European sustainability research house for 2009: full Thomson Extel rankings, by Hugh Wheelan, June 18, 2009, Responsible Investor, UK.

Three New Indexes Focusing On Sustainability. - [COMMENTARY] "Three index providers this week announced new products focused on companies that address environmental issues or show class-leading efforts on sustainability reporting." The expansion in such products again underlines the increasing interest in green and sustainable investing.
More indexes to address sustainable investment, June 18, 2009, Environmental Finance, UK.

Review Articles On Socially Responsible & Ethical Investing In Canada. - [COMMENTARY] "... a compilation of stories reported from the Social Investment Organization's conference recently wrapped up in Winnipeg, as well as other events concerning governance. These articles probe the future of an investment model built on principles other than returns." These articles are a worthwhile read for anyone interested in ethical investing.
Is SRI sustainable in a downturn? June 16, 2009, advisor.ca, Canada.

Institutional Investors Target Fortune 500 Companies For Deforestation Risks. - [COMMENTARY] "Investors running assets of US$1.3 trillion have signed up to a new initiative backed by the United Nations and HRH Prince Charles’ Rainforests Projects that will ask 150 companies in the Fortune 500 index as well as 50 other companies to report on risks that they could be contributing to dangerous deforestation." This type of initiative is important to get companies to realize how they might improve their practices, not only in regard to deforestation, but in many other areas of environmental, social and governance concerns as well.
Investor-backed, UN/DFID supported project targets Fortune 500 companies on deforestation risks, by Hugh Wheelan, June 15, 2009, Responsible Investor, UK.

Some Banks Cutting Back On SRI Coverage: Survey. - [COMMENTARY] "Several banks are cutting back their analysis of companies’ socially responsible policies, according to
Thomson Reuters, which does a regular survey of equity analysts... Steve Kelly, global
head of surveys at Thomson Reuters Extel, said Citigroup, JP Morgan and Bank of America Merrill Lynch were among the banks to have cut back in the past few months. Merrill Lynch’s specialist, Zoe Knight, was one of about 20 analysts to be let go in January, as a result of the merger with Bank of America."

Some perspective on these cuts must be noted. Though unfortunate, they were not disproportionate to the layoffs made generally in the industry.
Banks move to scale back socially responsible investing, by Mark Cobley, June 8, 2009, Thomson Extel article appearing in Wealth Bulletin, USA.

Interest In SRI Rising Significantly In Mid-East. - [COMMENTARY] "Economic downturn has increased Middle East investors' inclination towards socially responsible investments (SRIs), with interest rising four times in the past six months... The SRIs are particularly appealing to investors seeking diversification or opting for investments that are socially responsible
or follow certain criteria in line with Shariah-compliant products, said Firas Mallah, Head of Middle East, Dexia Asset Management."
It is encouraging to see the interest in ethical stocks and bonds rising in one of the most troubled regions of the world.
Interest in SRI rises four fold, by Shveta Pathak, June 8, 2009, Business24/7, United Arab Emirates.

Carbon Cap Could Wipe-Out Many US Companies' Earnings. - [COMMENTARY] "American Electric Power Co., Allegheny Energy and Ameren Corp’s future earnings potentially could
be more than wiped out by costs under a cap-and-trade program requiring purchase of
carbon emission credits, according to a report released today by the Investor
Responsibility Research Center Institute and Trucost, a provider of data and analysis on corporate environmental impact."
A reminder--not only for ethical investors, but for all investors--of the need to take into account the future of carbon emission caps when evaluating a company's prospective financial performance.
US carbon cap and trade could wipe out some US companies future earnings: report, by Barry B. Burr, June 3, 2009, Responsible Investor, UK.

US Pension Shareholder Activism Has No Economic Value, May Breach Fiduciary Duty: Chamber of Commerce. - [COMMENTARY] "Shareholder proposals filed by union-sponsored and public pension plans at US corporate AGMs show no clear evidence of short- or long-term improvements in operating or stock market performance of the target firms and may be placing trustees in breach of their fiduciary duty under ERISA guidelines, according to a study commissioned by the US Chamber of Commerce... The consultant  [Navigant Consulting] said its research found no statistically significant overall short-run or long-run improvement and said there was actually some indication of a long-run decrease in market value for target firms in the sample." I will be fascinating to see if these findings affect future shareholder resolutions! My guess is that the pace of such resolutions will only increase until whole industries change.
US pension shareholder activism has no economic value, may breach fid duty: Chamber of Commerce, by Hugh Wheelan, June 3, 2009, Responsible Investor, UK.

UK Study Says Ethical Investing Far More Important Today Than In The Past. - [COMMENTARY] "The Friends Provident study showed nearly three quarters of Brits (74%) agree it is important that companies take social, ethical and environmental issues
seriously. Further to this over half (54%) think ethical investing is far more important than it was 25 years ago when the UK was emerging from a recession."
Again, the Brits show leadership concerning their desire for ethical investing.
Brits determined to make profit without compromising principles, June 1, 2009, Easier Finance, UK.

Note: Articles are linked to the original source. Some sites may require registration, and may, or may not, archive stories. All links were active at the time of publication.

Disclaimer: Neither The Soul Investor nor Ron Robins make investment recommendations. Nothing in this newsletter should be interpreted as a recommendation or solicitation to buy/sell any securities or investments. The Soul Investor is a source of general information and resources for spiritual investing, ethical investing, and socially responsible investing (SRI). Investors should consider their actions thoroughly and consult their professional advisers prior to taking any investment action. The Soul Investor does not necessarily agree with the opinions expressed in articles in its newsletter or offered on the web pages to which it might be linked. Such opinions are the responsibility of the writers themselves. Furthermore, The Soul Investor 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 in this e-newsletter, or other sites, to which it might be linked.

The Soul Investor is a publication of Investing for the Soul, a registered business name in Ontario, Canada. Copyright © 2009 Ron Robins. All rights reserved.