E-newsletter of Investing for the Soul March 30, 2009
Top ethical investing news for March 2009
Links may only be valid a limited time Commentaries by Ron Robins
Huge US Funds Manager TIAA-CREF To Engage In Effort To Avoid Companies With Ties To Genocide. - [COMMENTARY] "In an important victory for the cause of genocide-free investing, Investors Against Genocide has announced it withdrew its shareholder proposal from the proxy ballot for TIAA-CREF’s July shareholders’ meeting. This announcement follows TIAA-CREF’s decision to vigorously engage PetroChina and other problem companies partnering with the Government of Sudan and to divest from those companies if they continue to substantially contribute to genocide or crimes against humanity. TIAA-CREF’s policy applies to the ongoing genocide in Darfur, Sudan, as well as to future genocides."
As was the case with funds and banks
boycotting apartheid South Africa, so divesting from companies with ties
to regimes associated with genocide could gain real momentum.
TARP Banks Rebuff Shareowner
Request to Create Economic Security Committees.
"Shareowner proposal introduced by Harrington Investments is excluded
from proxy ballots by the SEC, and Bank of America and Citigroup refuse
a direct request from Harrington to form a board-level committee."
After reading this item, a reader has to conclude that the financial
elites will go to any lengths to protect their interests--even if it is
at the expense of the public interest.
Useful, Brief Primer On Shariah
Stock Screening. -
"Sharia-compliant investment management is concerned with investments in
assets that are in compliance with Islamic law. An Islamic investor is
not allowed to invest in companies that derive most of their revenue
from non Sharia-compliant business activities, or that use interest in
operating or financing their business. In the context of investing in
equities, screening for Sharia compliance is ensured using two main
screens: business activities and financial ratios." Many ethical
investors and analysts might like to read this article for insights they
could apply to their own investment analysis.
’Say On Pay’ Non-Binding
Shareholder Resolutions Becoming A Feature At Canadian Company Annual
General Meetings. -
the past month, 10 of Canada’s largest companies have agreed to give
investors a non-binding annual vote on chief executive officer pay - a
practice known as say on pay - and Mr. Hawton anticipates many more will
voluntarily adopt the practice as it enters the mainstream." The
furor surrounding the AIG bonus situation may well change senior level
compensation packages in public companies for years to come. But
special compliments need to be paid to Gary Hawton for pioneering say on
pay resolutions in Canada for the past several years. Companies with
declining revenues yet with executive compensation hundreds of times the
annual pay of company employees, is simply unethical and irresponsible.
US Insurance Regulators Requiring
All Insurance Companies With More Than $500 Million In Annual Premiums
To Disclose Climate Change Risks & Plans To Deal With It.
"The National Association of Insurance Commissioners (NAIC) today
adopted a mandatory requirement that insurance companies disclose to
regulators the financial risks they face from climate change, as well as
actions the companies are taking to respond to those risks." Great
news for policyholders as well as for ethical investors looking for
insurance stocks that are good to invest in.
MBA Students Seek Long Term Focus
In Curricula (2). -
out of ten respondents say that a focus in business on short-term rather
than long-term results has been one of the contributing factors to the
global financial crisis. Just 24% of respondents strongly agree that
they are learning how to make business decisions that will help avert
similar crises. In addition, a majority of the students surveyed
strongly agree that there is a need for business schools to introduce
other financial models into the curriculum, specifically models that
take long-term social impacts into account." Wow, what a change in a
few short years! Another example that the short-term anything goes
mentality is giving way to a new higher holistic consciousness.
US Population Less Convinced
About Global Warming. -
"Although a majority of Americans believe the seriousness of global
warming is either correctly portrayed in the news or underestimated, a
record-high 41% now say it is exaggerated. This represents the highest
level of public scepticism about mainstream reporting on global warming
seen in more than a decade of Gallup polling on the subject." This
will be an important trend to watch!
Norway’s Giant Oil Fund Bars
China′s Dongfeng Motor Group Co. Ltd.; Is Reviewing Siemens AG For A
Possible Ban. -
$297 billion fund will be barred from investing in Dongfeng Motor on a
recommendation from the Council on Ethics because of sales of military
trucks to Myanmar, the Finance Ministry said in Oslo today... Germany′s
Siemens AG, Europe′s largest engineering company, was put under
observation because of the ’gross and systematic corruption the group
has been involved in over many years,’ Norway said." Norway’s giant
fund continues to demonstrate leadership in its selection of ethical
stocks and bonds. It is worthwhile for ethical investors to always take
not of what this fund does.
Survey: Business Students Want
Companies To Address Environmental & Social Issues (1).
"... 77 percent of MBA students view acting responsibly as a way to
increase corporate profits, a figure that has grown since 2006, when 60
percent of students saw the correlation between CSR and profitability in
Net Impact’s first study." It seems that business students really
appreciate the advantages of using corporate social responsibility.
Recession Slowing Corporate
Social Responsibility Initiatives. -
"The [Booze & Co.] survey reveals that 40 percent of respondents expect
green and other corporate social responsibility (CSR) initiatives to
significantly slow due to the downturn, while 29 percent of respondents
don′t believe it will delay green projects. The pullback will be
especially evident in transportation and energy industries, with,
New Index Series Tracks Gender
[COMMENTARY] "’What we found to be
especially interesting in our research was the positive correlation
between gender diversity in Boards of Directors and senior management
and the quality of earnings reported by companies," Gorte continued...
The Index series will include large and mid cap companies that recruit,
retain, and promote women.’" This will be a fascinating index series
to watch and to see how it influences both corporate management and
investor behaviour. Will the best socially responsible stocks to invest
in be led by women?
Investors With $55 Trillion In Assets Want More Corporate Action On Carbon Emissions Reductions & Strategies. - [COMMENTARY] "Investors that are signatories of the Carbon Disclosure Project (CDP), a nonprofit organization which acts as an intermediary between shareholders and corporations on climate change issues, want the companies in which they invest to do more than just disclose climate and carbon information. The CDP signatories, who manage $55 trillion in assets, want companies to take such additional actions as adopting emissions reductions targets and developing low carbon solutions as well."
The survey of institutional
investors supports the view that analysts are increasingly incorporating
climate change factors in their analytical methodologies. The survey
results were compiled by Mercer.
CRO Magazine Says Bristol
Myers-Squibb, General Mills, Inc., & IBM Corp. Are 2009’s Top Corporate
Citizens In Its Top 100 List. -
"... the methodology used to compile this year′s 100 Best list was
debated and voted on in open session by 27 leading corporate
responsibility practitioners representing nine major industry segments
October 2008 at the CRO Conference in Chicago." Of course, in such
lists, one has always to pay attention as to how they are compiled. Most
of these companies are considered among the most popular stocks that are
good to invest in by SRI funds.
Christian Brothers Survey: Human
Trafficking & Abortion Top Issues Of Concern Among Catholic
Institutional Investors. -
issues of concern are, "... companies that support governments
engaged in genocide or terrorism... environmental justice,
sweatshops/contract supplier standards, and access to water and
responsible use of water resources... 85% of Catholic institutional
investors believe that active ownership has a positive impact on
corporations." Morally conscious investing is huge. In America, one
dollar in nine is invested in portfolios that screen-out investments
engaged in activities such as those cited above. Spiritual investors
will find the results of this survey useful.
New US Low Carbon Index Launched
By S&P. -
[COMMENTARY] "The S&P U.S. Carbon
Efficient Index is composed of a subset of constituents in the S&P 500
with a relatively low Carbon Footprint while maintaining at least 50% of
the original weight representation for every GICS® sector in the S&P
500. The Carbon Footprint is calculated by Trucost PLC and is defined by
the company′s annual greenhouse gas (GHG) emissions assessment,
European Study Shows No Outperformance Of SRI Funds During 2002-7. - [COMMENTARY] "’None of the socially responsible investment equity funds available to European investors produced alpha or outperformance, according to an EDHEC Risk and Asset Management Research Centre study released today... ’SRI security selection in itself does not lead to outperformance,’ the report said. ’Our results show that SRI fund performance is accounted for instead by style biases and market cycles.’"
This author is just saying that
there are still no magic SRI formulae for stock market outperformance.
However, as I have argued many times we can at least invest according to
our values and still likely enjoy conventional returns. But I still
believe that investment analysis incorporating ESG (environmental,
social and governance) and ethical factors will over the long-term
provide superior market returns.
SIRAN: Corporate Responsibility Gaining Ground In Emerging Markets. - [COMMENTARY] "By using a subset of EIRIS′ assessment methodology and publicly available documentation, 40 leading companies in ten emerging markets were examined and each company was assessed against key environmental, social and governance (ESG) criteria... This study′s findings indicate that the majority of the 40 emerging market companies have shown evidence of addressing at least some ESG issues in their public disclosures."
SIRAN is a network of 150 investment
analysts in North America, supporting the ESG research work in more than
30 investment related firms. It’s terrific to see companies in emerging
markets seeing the advantages of using corporate social responsibility.
Pollution Cap Could Boost 1,200
US Companies. -
that puts a cap on greenhouse gas pollution will spur job expansion in a
dozen manufacturing states in the U.S., according to the Environmental
Defense Fund. The environmental group published on Friday an online
interactive map identifying more than 1,200 companies that stand to
benefit from future climate change legislation." Indeed, a
re-alignment of dollar flows from carbon producers to green and greener
companies could soon take place.
The Sunday Times (UK) Publishes
’The Rich Green List.’ -
first Sunday Times Green Rich List shows that the enthusiasm among the
world′s wealthiest for investments in areas as diverse as electric cars,
solar power and geothermal energy is unaffected by the recession."
It’s inspiring to read how the world’s richest people are putting their
money into green and sustainable investments.
The Uptime Institute Publishes
Its List Of The World’s 100 Greenest Companies.
"The list highlights the significant energy efficiency achievements
of global corporations operating major data centers. It includes
exemplary FORTUNE 500 and InformationWeek 500 organizations with a
demonstrated board-level policy and governance commitment to increasing
energy efficiency and reducing the carbon footprint of their enterprise
IT and data center operations." These are certainly among the
world’s most environmentally conscious major corporations. You have to
suspect that there is a correlation between a company’s focus on green
IT and their commitment to sustainability.
Can SRI Ratings Predict Stock & Portfolio Performance? By Ron Robins, March 13, 2009.
Can SRI Ratings Predict Corporate Behaviour? By Ron Robins, March 13, 2009.
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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.