Investing for the Soul
- Wall Street Journal
- BNN (Business News Network)
- The Financial Post
- Rogers Television's Money Line
- CBC One's Metro Morning
- 680 News Radio
- Environmental News Network
- The Catholic Register
"Forty-five percent of U.S. households prefer an
environmental, social and governance (ESG) approach to
investing... Among those between the ages of 30 and 39,
this increases to 64%, and for those younger than 30, it
-- Cerulli Associates
"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."
"70% of people [in UK] want to invest
ethically but the financial services industry is failing
to respond." Referencing research by Abundance.
(UK) June 2015
Ethical Investing News/Commentaries:
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New Corporate Sustainability
Reporting Platform Proposed. -
"The 88-page From Transparency to Performance:
Industry-Based Sustainability Reporting on Key
Issues has been backed by The Hauser Center for
Non-profit Organizations at Harvard University and
the Initiative for Responsible Investment. The
authors are Steve Lydenberg, Chief Investment
Officer at Domini Social Investments, Jean Rogers,
Principal at consulting firm Arup and David Wood,
Director of the Initiative for Responsible
Investment." This could be a breakthrough
corporate reporting platform document! It will be
truly interesting to see who gets behind it.
New proposal for sustainability indicators
published, by Daniel Brooksbank, July 30, 2010,
Responsible Investor, UK.
Environmental & Social
Shareholder Resolutions Make Big Gains So Far In
"The season was marked by record-breaking
investor approval for corporate policies that
protect LGBT rights, more reporting on
sustainability in general and the environment in
particular, and increased disclosure of political
spending. Results are now available on nearly all
the 387 shareholder proposals Si2 is tracking,
including votes on the 166 resolutions that came to
votes in the first six months of the year." This
is another item of good news. Many companies need to
be held to task for their actions more than ever
Social and Environmental Proposals in 2010--mid year
review, by Heidi Walsh, July 22, 2010,
Sustainable Investments Institute, USA. (Courtesy of
Responsible Investor, UK.)
US SRI Groups Call On Electronics
Manufacturers For More Oversight On Suppliers After
"The statement, signed by 45 members of the
investment community, condemns abusive workplace
conditions in the electronics industry, where a
recent spate of suicides at Foxconn -- supplier to
some of the industry's largest firms, including
Apple, Dell, Hewlett Packard and many others -- led
to widespread criticism of the company and its
customers, and which pressured Foxconn to offer
significant raises to its workers."
Faith Institutions Find
Responsible Investing Difficult. -
"'The current investment market is not capable of
providing all the tools and services that are
required by religious investors' says [Professor
Celine] Louche, 'The great majority of religious
institutions surveyed said that their religious
beliefs are reflected in their investment practices,
but 51% say they would invest more if there were
reliable tools to do so in accordance with their
I find the results of this research interesting as I
believe that there are now sufficient
ethical-socially responsible asset management
companies to fulfil religious investment parameters.
I wonder if the religious institutions themselves
have really done their homework or are locked-in
with friendly and cosy relationships spanning
Faith institutions find responsible investment an
uphill struggle, July 26, 2010, press release,
The International Interfaith Investment Group,
Intel, Weyerhaeuser & Merck Tops
In Green Governance Rankings, Says Governance and
Environmental Management Strength (GEMS). -
"The GEMS Rating gives companies a score on a
100-point scale, based on their ability to
anticipate and manage environmental issues that
offer risks and opportunities to their operations.
The GEMS Rating assesses companies depending on the
presence or absence of 49 indicators in five
categories: governance, policy, infrastructure and
systems, performance results and transparency and
accessibility." See the top ten companies in the
Intel Comes Out on Top in Green Governance Rankings,
July 21, 2010, GreenBiz, USA.
Netherlands Study Examines Why Both
SRI & 'Sin' Stocks Outperform. -
"A segmentation of the socially responsible
investing (SRI) movement by values-versus-profit
orientation solves the puzzling evidence that both
socially responsible and controversial [sin] stocks
produce superior returns." This is a fascinating
new study discussing ethical -socially responsible
investing from an insightful perspective.
A Tale of Values-Driven and Profit-Seeking Social
Investors, by Jeroen Derwall, Kees Koedijk, and
Jenke Ter Horst, July 13, 2010, School of Economics
and Management, Tilburg University, The Netherlands.
New Study Finds SRI Funds
Slightly Outperform On A Risk-Adjusted Basis. -
"[The study] found that while SRI funds tended to
slightly underperform their non-SRI peers (-17 bps
per year), they tended to slightly outperform on a
risk-adjusted basis (+1 bps year), results that were
neither statistically nor economically significant."
Study period was 19
years. It is a useful addition to the already
significant body of research on this topic.
Exploring the Cost of Investing in Socially Responsible
Mutual Funds: An Empirical Study, by David M.
Blanchett, July 21, 2010, The Journal of Investing,
US Congressional Budget Office
Report Highly Critical Of Benefits From Ethanol Tax
"In its calm and measured way, the Congressional
Budget Office (CBO) just delivered a blistering
assessment of the environmental value of corn-based
ethanol." When this subsidy was first announced
I, like many others, proclaimed it as a way to buy
farm votes and was a terribly expensive method to help
the environment. Now it seems the CBO agrees.
Ethanol gets skewered by recent CBO assessment,
by Tom Philpott, July 16, 2010, GRIST, USA.
Over 90% Of Institutional
Investors Want Green Investments. -
"Green private equity is on the agenda of
virtually all institutional investors, with more
than 90 per cent wanting exposure to the sector,
according to a new survey. Over 90% of institutional
investors claim they want to have exposure to
'green' investments... The challenge for green
private equity and venture capital managers is to
accelerate the current levels of interest and future
expectations into actual commitments into their
funds sooner rather than later." This
another good sign for ethical investors and for the
Institutional Investors Increasingly Looking at
Green Private Equity and Venture Capital, According
to New Survey, July 20, 2010, press release by
New Energy World Network & AltAssets, UK.
Corporate Environmental Budgets
Increasing Despite Economic Woes. -
"Our most recent green economy survey shows signs
of steady growth in corporate environmental
initiatives, a level of optimism that outstrips that
of the overall recovering economy, according to the
semi-annual 'Green and the Economy' survey conducted
by our GreenBiz Intelligence unit." This is
great news. It seems that it is largely customer
Green Business Forecast Shows Strong Growth Ahead,
by John Davies, July 19, 2010, GreenBiz, USA.
Hong Kong's Hang Seng Launches
Sustainability Indexes. -
"Hang Seng Indexes has become the latest to
launch a series of sustainability indices, covering
Hong Kong and Chinese companies. The aims of the
index series is to 'further raise awareness about
corporate sustainability' as well as to meet
international demand for socially responsible
investment in Chinese companies."
UK Shelves Green Investment Bank
"Plans to use money from the sale of government
assets to provide the riskiest of equity investment
in green energy projects such as offshore wind and
carbon capture have been shelved by the government."
I love the idea of more green investment, but tax
policies that level the playing field and
incentivise innovation might be better.
coalition government, by Nicholas Timmins, July
15, 2010, Financial Times, UK.
'Too-Big-To-Fail' Banks Excluded
From US Socially Responsible Mutual Fund. -
"Last week Appleseed Fund began tarring
'too-big-to-fail' banks with the same brush as
pornographers, weapons-makers and others... 'Given
the failure of regulators to prevent the credit
crisis and the subsequent failure of legislators to
break up the massive and interconnected banks that
helped create the crisis, it's incumbent on
depositors and investors to vote with their
wallets,' co-portfolio manager Adam Strauss said."
Controversial, but this is a stand
I agree with. American and European big bank management attitudes and
practices have not changed, and pretty much the same
executives involved in causing this mess are still in
place. Well done Appleseed!
Socially responsible mutual fund cuts out
'too-big-to-fail' banks, by Becky Yerak, July
14, 2010, The Chicago Tribune, USA.
Hong Kong Giving Investors Two
Days To Change Their Minds On Some New Investments.
"Beginning in January of 2011, the HKMA has
mandated that banks allow first-time investors and
those over the age of 65 a two-day period in which
to think about the investment they’ve just gotten
into. Lenders will be looked at in regard to the
selling of unlisted securities, futures products and
structured deposits but not listed stocks, futures
and warrants." Do you think this will catch-on?
I guess they had to leave out listed securities.
Banks cringe at thought of ethical behavior,
July 14, 2010, The Dark Side, Hong Kong.
Investor Activism Increases On
Climate Change. -
"Eighty-eight U.S. and Canadian companies
received 101 shareholder resolutions in the
2010 proxy season, a 48.5 percent increase over the
year before, according to the Investor Network on
Climate Risk (INCR) . Of those, 51 were withdrawn by
investors after their demands were met with action
or commitments. In comparison, investors filed 68
climate and energy resolution in the 2009 proxy
season, 31 of which were withdrawn following
corporate commitments." As investor interest
grows in sustainability issues and ESG reporting
becomes increasingly important, companies are seeing
the light that they must be more vigorous in their
actions on climate change.
Investor Activism on Climate Shows No Sign of
Slowing, July 8, 2010, ClimateBiz, USA.
Western European CEOs Do Not
Believe Decline In Biodiversity A Problem For
Business Growth. -
"More than 50% of a sample of chief executive
officers (CEOs) in Latin America (167 companies
surveyed) and 45% (40 companies surveyed) in Africa
believe a decline in biodiversity – such as plant
and animal habitats – is a challenge to business
growth, against less than 20% of peers in western
Europe (442 companies surveyed), according to the
findings of The Economics of Ecosystems and
Biodiversity (TEEB) report released yesterday."
I suspect the numbers might be similar for North
American CEOs too. There is a lot of education yet
to take place. The increasing focus on
environmental, social and governance (ESG) issues
TEEB report: corporations out of step with consumers
on biodiversity loss, by Hugh Wheelan, July 14,
2010, Responsible Investor, UK.
There Are Now 410 Asian SRI
Malaysia has the largest number at 146 funds, and
they are all faith-based, whereas, all of Japan's 71
South Korea's 69 SRI funds are not.
Click here forASrIA data.
New Type Of Fund Focuses On
Shareholder Activism. -
"Australian Ethical Investment (AEI) has launched
an index fund that seeks to engage with companies
about their policies on climate change and improve
their disclosure. The Climate Advocacy Fund (CAF)
invests in Australia's largest companies by economic
footprint, which is measured by sales, cash flow,
book value and dividends."
This is a new concept for ethical investors to
consider. I remain on the sidelines as to whether
this will work or not. It will be interesting to see
what the fund actually does and the results it
Australian Ethical launches climate index fund,
by Wouter Klijn, July 8, 2010, Investor Daily,
The $120 Billion Canada Pension
Fund Makes Big Investment In Tar Sands. -
"Taking a page from the playbook of overseas
investment funds, the managing arm of the CPP on
Tuesday made its first foray into the oilsands as a
private equity investor by sinking $250 million into
Calgary-based Laricina Energy."
should be noted that this pension fund prides itself
on its ethical investing principles. No doubt this
investment might upset some ethical investors.
CPP joins oilsands investment fray, by Shawn
Polczer, July 7, 2010, Calgary Herald,
CSR Programmes Create More
Motivated & Committed Employees, says Boston College
Center For Corporate Citizenship Study. -
"Corporate social responsibility programs are
linked to how committed an employee is to an
employer... Employee perceptions about corporate
social responsibility remained constant during the
depth of the economic decline... Corporate social
responsibility programs are not a panacea for
retention issues." Here is more justification
for ethical investors to seek out companies with
good corporate social responsibility (CSR)
credentials. It is with such employee
characteristics that companies with great CSR
policies are usually 'best-in-class' in financial
performance as well as often tops in stock performance
Study links corporate social responsibility programs
and employee commitment, July 2010, Boston
College Center for Corporate Citizenship, USA.
New UK Guide For Charity
Trustees. Of Interest To Charity Trustees Globally.
"Jointly launched by the EIRIS Foundation and
Charity Finance Directors' Group (CFDG), the free
guide provides practical advice and presents case
studies of charities that have adopted a responsible
investment approach to help other charities to align
their principles with their investment practices."
Though the UK has a relatively smaller ethical
investing footprint than the US, it seems to account
for a disproportionate amount of leading edge
ethical investment research, studies and news. This
guide is typical of the quality of material coming
from the UK. As I indicated too, it is worthwhile
reading for anyone, anywhere who is engaged in
managing charity funds.
New guidance to help more charity trustees invest
responsibly, EIRIS Foundation and Charity
Finance Directors' Group (CFDG), UK.
Global Cleantech Venture Capital
Investment Up 63% In First Half Of 2010. -
"Clean technology venture investment worldwide
has soared by 65% in the first half of 2010 compared
with the same period last year. According to
preliminary results by the Cleantech Group, in
collaboration with financial service provider
Deloitte, cleantech venture investments came to more
than $2bn (€1.6bn) across 140 companies in North
America, Europe, China and India in the second
quarter." The ongoing BP oil disaster is fuel
Global cleantech investment soars by 63% in first
half, by Nina Röhrbein, July 5, 2010, IPE, UK.
The 2010-2011 Ethics In Finance -
Robin Cosgrove Prize For People Under 35. -
"Young people aged 35 or less are invited to
submit innovative ideas for ethics in finance. Two
Competitions for the Prize *The global Prize has
been awarded since 2006. For the global Prize papers
should be submitted in English or French. *The Ibero-American
Prize was initiated with the support of MAPFRE to
focus on the special challenges of ethics in finance
in the region, with papers to be submitted in either
Spanish or Portuguese. The best papers submitted for
the Ibero-American Prize will be translated into
English or French and they will then be nominated
for consideration for the global Prize."
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