E-newsletter of Investing for the Soul August 30, 2009
Top ethical investing news for August 2009
Links may only be valid a limited time Commentaries by Ron Robins
Study: Higher Returns On Companies Listed In FTSE KLD (US) 400 Social Index. - [COMMENTARY] "Our study considers whether ethical investments are also good investments. We utilize long-run event study methodology to study abnormal returns associated with firms being included in, and dropped from, KLD Research and Analytics’ (KLD) Domini 400 SocialTM Index (DS400). There are positive and statistically significant long-run abnormal returns for firms being included in the DS400. The market also appears to anticipate decisions to include firms in the DS400; short-run abnormal returns associated with firms being included in the DS400 are consistent with the market correcting high abnormal returns before the date the firm is added to the index."
This study supports my
view that ethical stocks may well provide premium returns over the
Over Half Of 1,000 Largest US Companies Have An
Environmental Policy, But Lack Internal Environmental Management
Structures, Says Survey -
"This report, entitled "The Road Not Yet Taken: The State of U.S.
Carbon Efficiency Is Key To Gaining Market Share:
"Companies need to understand how looming carbon costs will impact
their future profitability compared to their competitors in order to
gauge how much can be passed on to customers, according to a new report
from research firm Trucost Plc and standards nonprofit NSF
International." How companies deal with their carbon emissions will
help determine their future market shares and profitability. This report
clearly illustrates the relationships.
Americans Spending Big On Complimentary And Alternative Medicine. - [COMMENTARY] "Americans spent $33.9 billion out-of-pocket on complementary and alternative medicine (CAM) over the previous 12 months, according to a 2007 government survey. CAM is a group of diverse medical and health care systems, practices, and products such as herbal supplements, meditation, chiropractic, and acupuncture that are not generally considered to be part of conventional medicine. CAM accounts for approximately 1.5 percent of total health care expenditures ($2.2 trillion2) and 11.2 percent of total out-of-pocket expenditures (conventional out-of-pocket: $286.6 billionand CAM out-of-pocket: $33.9 billion) on health care in the United States."
Many ethical investors are
interested in investing in companies providing products and services in
this area. It obviously has significant appeal to them. However,
investors have to be particularly careful as many of these products and
services 'come and go.' Investors need to look for hard, independently
verifiable data on the products/services of companies in this space
before investing in them.
The €276bn Norwegian Government Pension Fund Set To Pressure 1,100 Companies On Water Usage. - [COMMENTARY] "Norges Bank Investment Management (NBIM), which runs the Norwegian fund’s assets, said it had holdings in about 1100 companies with a combined market value of €33bn where it believes good water risk management could be critical to future performance. During the third quarter of this year, the fund said it will publish a list of water reporting and risk management 'expectations' it has for portfolio companies."
With increasing scarcity
of fresh clean water worldwide and its implications for society and for
corporate profits, NBIM is to be congratulated on this move. As Europe's
largest single investor, they have the clout to get companies to
respond. It will be fascinating to see how companies respond and as to
what they report. Ethical investors will also be most interested to see
how the results of their survey affect this funds portfolio!
EIRIS Analyses 300 Of World's Largest Companies For
Their Actions On Climate Change. -
"Some improvements, but further
Over Thirty SRI Research Papers Submitted For
Moskowitz Prize. -
"The Center for Responsible Business at UC Berkeley's Haas School of
Business has concluded the submission process for the 14th Annual 2009
Moskowitz Prize, the only global award recognizing outstanding
quantitative research in the field of socially responsible investing
(SRI). According to First Affirmative Financial Network, co-sponsor of
SRI in the Rockies, over 30 research entries were accepted by this
year's submission deadline." Apparently, this is a record number of
submissions and the quality of the research continues to improve
ESG Issues Have Come To The Fore Among Emerging Market
"In 2009, 46 percent of asset owners strongly agreed with the
statement 'ESG issues are an important part of our research, portfolio
management and manager selection,' up from 36 percent in 2007. The
majority of asset owners (78 percent) think
Shareholder Engagement--New Report Offers Useful
Advice & Perspective. -
"There is a real debate as to whether there should be a forum for
collective engagement. This could have the benefit of ensuring companies
hear the range and depth of investor views and also bring economies of
time spent for companies. But there is genuine concern and nervousness
that collective forums would not allow open and honest dialogue and
could simply create another ‘box ticking’ activity as senior people
would not attend." It is clear that many shareholders want to be
actively engaged in the companies that they invest in. This report is of
significant interest to such individuals and institutions.
Study: Screening For Quality Corporate Governance Adds
To Returns. - [COMMENTARY]
"Results from this
study found that enhanced screens for corporate governance risk
augmented investment returns in a hypothetical fund. The results of the
study set the stage for the development of a commercially-viable
governance alpha index." This
fascinating study has just come to my attention, courtesy of Canada's
Social Investment Organization. It provides more proof that screening
for factors that demonstrate quality governance can prove profitable.
Click link below and scroll down to study. You will need to 'add it to
cart' but it is free.
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. 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.
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.