E-newsletter of Investing for the Soul May 30, 2012
Top ethical investing news for May 2012
Links may only be valid a limited time Commentaries by Ron Robins
Twitter allows me to cover more--and breaking news--to help you do better!
US Stockholders Filing Over 30% More Political & Lobbying Disclosure Proxies in 2012 over 2011. - [COMMENTARY] "The transparency push, playing out at shareholders meetings from coast to coast this spring, has received cheers from campaign finance reformers and some corporate governance experts. It has drawn ridicule from critics such as the U.S. Chamber of Commerce, who see the effort as an attempt by liberal groups to squelch the voice of the business world."
I find it difficult to believe how anyone could be opposed to such a
fundamental right as shareholders knowing where the funds of the
companies they invest in are being spent! Yes, it’s about time for
complete transparency on this issue.
European CEOs Take Aim At Shareholder Advisory Firms.
- [COMMENTARY] "European CEOs
are so angered by the rise of opposition to gold-plated executive
payouts that they have taken the unusual step of pushing for more red
tape, calling for regulation of the advisory groups who advise fund
managers on how to vote on issues such as executive pay." This is
not a surprising tactic when many individuals in senior management
believe they have the God given right to exemplary compensation
Canadian SR-Ethical Funds Outperform Conventional Funds. - [COMMENTARY] "One of the continuing perceptions held by many advisors is that socially responsible investment funds underperform the market. These advisors believe that, by screening out certain companies or industries, investment opportunities are reduced and therefore risk is increased. The result – lower returns than funds invested in a conventional way... The Social Investment Organization recently did an in-depth analysis of returns for socially responsible investment (SRI) funds in Canada across major asset classes. Using the most recent performance numbers provided by Fundata 1 (to March 31, 2012) a portrait is emerging of a strongly performing industry with outperforming funds in every major fund category."
Over the long term I’m convinced that such outperformance will become
even more pronounced, not only in Canada but for SR-ethical funds
$1 Trillion SRI Coalition Tell Shale Energy Companies To Clean Up Their Act. - [COMMENTARY] "The coalition, led by Boston Common Asset Management, the Investor Environmental Health Network and the Interfaith Center on Corporate Responsibility, includes companies such as Dexia Asset Management, Domini Social Investments and Pax World Funds. In a statement released Wednesday, the socially responsible investing (SRI) asset managers said they wanted energy companies to adopt 12 best practices regarding risk management and reporting that members of the coalition drew up last December."
US shale energy extraction is becoming a huge issue, both for its
promise of dramatically reducing energy imports, but also for its
potential to cause serious environmental and health problems. Somehow
the ’excitement’ has to turn from carbon-based energy to renewable
New Type Of Sustainable Global ETF Launched.
- [COMMENTARY] "This is brilliant.
AdvisorShares is launching next week a new exchange-traded fund that
will support sustainability themes globally. A portion of the assets
will support a charitable foundation co-founded by Philippe Cousteau,
grandson of the famous explorer Jacques." This is an interesting new
concept for ethical investors. It will be well worth watching.
Calls To End Corporate Secrecy In US Shell Companies.
- [COMMENTARY] "A group of 41
businesses and nonprofits sent a letter to every member of Congress
pressing them to pass legislation that would reveal the beneficial
owners of shell companies. ’Investigations continue to reveal that
American and foreign terrorists, narco-traffickers, arms dealers,
corrupt foreign officials, tax evaders, individuals targeted for
financial sanctions and other criminals easily and regularly set up U.S.
shell companies, without providing any information about who owns or
controls such companies,’ the letter says." What is being called for
here I believe sounds more than reasonable!
New Human Rights Based ETF Planned. - [COMMENTARY] "The iShares Human Rights Index Fund takes a different approach to the category of SRI funds. The underlying index aims to exclude companies that provide material support for controversial regimes or governments that are subject to widespread sanctions based on human rights violations. At this time, governments in three countries—Sudan, Iran and Burma—meet those standards, according to MSCI, which created the index for BlackRock in November 2011."
Should it be launched, it will be most interesting to see how this fund
fares. One probable premise of the fund is that companies engaged with
such regimes might see relatively lower stock prices. Hence, by avoiding
such companies, this fund could benefit. Perhaps though, the main reason
this fund could succeed is that from an ethical perspective it simply
avoids such problem companies.
Businesses Say They Are Better At Delivering Social Change Than
Charities. - [COMMENTARY]
"More than 90 per cent of businesses said they were
equally or better equipped than charities to deliver social change,
according to a snapshot survey." This is an interesting perspective.
Are the businesses just being pompous or are they simply being factual?
With the growth of CSR there could be some substance behind this
Prior To London Olympics, Religious & Ethical Investors Ask Corporations To Step Up Anti-Trafficking & Slavery Efforts. - [COMMENTARY] "Christian Brothers Investment Services (CBIS), a leader in socially responsible investing, and a coalition of U.S. and U.K. investors and NGOs have united to call on corporations to strengthen their focus against human trafficking and modern slavery in advance of the 2012 Summer Olympic Games taking place in London from July 27 to August 12. The initiative focuses on the London tourism industry and key sponsors of the Olympic Games that may be at a higher risk for on-premise child and labor trafficking and that have the potential to help raise public awareness of these crimes."
At first glance, it might be difficult to link human trafficking and
slavery to the Olympics. Nonetheless, there’s never not a good time to
raise those issues.
EIRIS Reports On The Most Sustainable Companies. - [COMMENTARY] "This research paper provides a global snapshot of corporate sustainability performance on the 2063 companies from the FTSE All World Developed (AWD) Index. It presents the 10 current sustainability leaders as well as insight on the sustainability performance of 50 of the world′s largest companies (by market cap). Our analysis reveals some surprising differences in the extent to which leading companies are prioritising and responding to sustainability."
EIRIS is one to the most respected organizations in the ESG-ethical
analyst space. This is worth the read for any SR-ethical investor.
2012 Sustainability Leaders Survey. Rankings & How They’re Assessed. - [COMMENTARY] "The 2012 Sustainability Leaders Survey... asked respondents in February to name up to three specific companies that they consider to be leaders in integrating sustainability into their business strategy. Unilever, which launched its Sustainable Living Plan in late 2010, was mentioned most frequently for the second year in a row, while Interface was the next most frequently mentioned, followed by GE, Patagonia, and Walmart... A number of criticisms are routinely levelled at the poll."
This is a good review of what’s required to understand the various
methodologies of these polls.
MSCI, Barclays Launching ‘ESG′ Bond Indexes.
- [COMMENTARY] "The so-called
Environmental, Social ’ Governance (ESG) fixed-income indexes, which
will be co-branded, cater to asset managers and owners who need to
integrate ESG mandates into their fixed-income investments, the
companies said in a joint press release. The indexes could eventually be
used to benchmark ETFs." This is good news. We have many SR-ethical
equity investing raters, but few on the debt side.
Most US Companies Falling Short On Sustainability, says Ceres. - [COMMENTARY] "In the first major assessment of progress on a unique Ceres Roadmap to corporate sustainability released two years ago, Ceres and global research and analysis firm Sustainalytics today released ’The Road to 2020: Corporate Progress on the Ceres Roadmap for Sustainability.’ The findings - based on an assessment of how 600 U.S. companies are responding to environmental and social challenges such as climate change, water scarcity and supply chain conditions – show individual examples of leadership but significant need for overall improvement."
The results are unsurprising. However, as investors realize that
companies with strong ESG/sustainability programs outperform
financially, companies will have to cater to investor demands for a
strong ESG/sustainability focus.
US Churches Increasingly Divesting Bank Stocks.
- [COMMENTARY] "...religious
congregations have withdrawn about $40 million nationwide from the
country’s largest banks, including Bank of America, JP Morgan Chase,
Wells Fargo and Citigroup, said Tim Lillienthal, lead organizer with the
PICO National Network, the largest faith-based organizing network in the
United States." It’s a movement that could grow. The churches have
many complaints against the banks ranging from home foreclosure misdeeds
to excessive executive pay.
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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. 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 © 2012 Ron Robins. All rights reserved.