April 2013 Newsletter

April 2013 Newsletter

News & Commentaries by Ron Robins


Thomson Reuters Launches Corporate Responsibility Indices.– [COMMENTARY] “Thomson Reuters, the world’s leading source of intelligent information for businesses and professionals, today announced the launch of a new family of environmental, social and corporate governance (ESG) indices. The Thomson Reuters Corporate Responsibility Indices were developed jointly with S-Network Global Indexes, a New York based specialist index design firm, as an objective and transparent, rules-based benchmarking solution for measuring ESG performance. The announcement of the launch of the indices was made today at the CSR Investing Summit in New York.” Obviously, the proliferation of these indices must indicate to the wider investing public that ESG factors do matter and that money can be made with them.
Thomson Reuters Launches Corporate Responsibility Indices, press release, April 24, 2013, Thomson Reuters, USA.

Two US polls Contradict Independent Research On Sustainable Investment. – [COMMENTARY] “Both articles appear under headlines that perhaps reflect the bias of the publisher, with results that may contain sample bias, based on who was contacted and who responded. Blue & Green Tomorrow probed Spectrem′s Millionaire Corner on this. When contacted, Spectrem′s Millionaire Corner didn′t respond to an email asking for the wording of the question that brought about the social responsibility results. A representative did offer to create a chart about one aspect of their survey, but added that the raw data was not available.”

Readers of this site might note my earlier comments about Millionaire Corner’s survey. That comment stated, “How questions are framed plays a great role in how they’re answered. Had the questions been framed around ESG rather than social responsibility, I’m sure we would’ve seen a very different–and more positive–response.” I’m glad to see that Blue & Green Tomorrow actually contacted Millionaire Corner–but I’m saddened by the lack of cooperation they got from them. It makes one wonder how ethical Millionaire Corner is.
Two US polls contradict independent research on sustainable investment, by Alex Blackburne, April 18, 2013, Blue & Green Tomorrow, UK.

Top Industries Unprofitable If They Had To Pay For Consumption Of Natural Capital. – [COMMENTARY] “The total unpriced natural capital consumed by the more than 1,000 ’global primary production and primary processing region-sectors’ amounts to $7.3 trillion dollars a year — 13 percent of 2009 global GDP… Of the top 20 region-sectors ranked by environmental impacts, none would be profitable if environmental costs were fully integrated.”

I’ve suspected this for sometime. It’s good to finally get some real research on this topic. It really provides us with some concrete idea as to the real costs of our consumer society that one day will have to be met! This report might provide some ethical investors with a perspective of where they might want to invest.
None of the world′s top industries would be profitable if they paid for the natural capital they use, by David Roberts, April 17, 2013, grist, USA.

Q1 Global Green Investment Hits 4-Year Low Of $40.6B.– [COMMENTARY] “Global economics, regulatory uncertainty and falling PV and wind power costs are playing a role in declining greentech investment figures.” Government policy uncertainty relating to green investment support in the US and Germany play a significant role influencing these lower numbers.
Q1 Global Green Investment Hits 4-Year Low of $40.6B, by Jeff St. John, April 15, 2013, Greentechmedia.com, USA.

Online Course On The Fundamentals Of Sustainable And Responsible Investment Launched By The US SIF Foundation. – [COMMENTARY] “Today, the US SIF Foundation launched the Center for Sustainable Investment Education and the Center′s inaugural online course, Fundamentals of Sustainable and Responsible Investment. This is the first online course on sustainable investment for financial advisors and other investment professionals to be launched in the United States.” This is a good step forward to encourage more investment/financial advisors to offer socially responsible/ethical investments.
Online course on the Fundamentals of Sustainable and Responsible Investment launched by the US SIF Foundation, press release, April 9, 2013, US SIF Foundation, USA.

A New Breed Of Mutual Funds: The Activist Fund. – [COMMENTARY] “In what mutual fund manager IA Clarington Investments is calling the first of its kind in Canada, retail investors are being offered a product that “will invest in companies where an activist investor has disclosed an intention to change or influence the management or control of a company. But the fund, which is just being launched and will be managed by Larry Sarbit, a veteran of the investment world who also manages the IA Clarington Sarbit U.S. Equity Fund, will not itself be an activist investor. Instead it will invest in those companies that an activist investor has targeted.”

Though such funds aren’t really ethical funds, they do bear some relationship to them. Often, unethical or badly governed companies are targeted by others who believe they can do better. It’ll be interesting to see how such a fund performs.
IA Clarington Investments launches fund to invest in activist investor targeted companies, by Barry Critchley, Financial Post, Canada. (This article, dated a month ago, just came to my attention, courtesy of Ken Kivenko.)

New Research Report Reveals Corporate Social Responsibility Trends In Mid-sized Companies. – [COMMENTARY] “Two-thirds of mid-sized companies are seeking to either enhance or establish their CSR programs to do business with a purpose. About 60 percent of mid-sized companies focus their CSR efforts on education, demonstrating companies’ dedication to people-focused initiatives that cater to young people and the development of the workforce of the future.” The great thing about mid-sized companies is that they grow out of their communities and hence have a deeper attachment to those communities.
New Research Report Reveals Corporate Social Responsibility Trends in Mid-sized Companies, press release, April 10, 2013, Business4Better Movement, USA.

For UK Ethical Investors, Blue&Green Tomorrow Has Created A Guide to Ethical Financial Advice 2013. – [COMMENTARY] “Welcome to Blue & Green Tomorrow′s Guide to Ethical Financial Advice 2013. Here, you′ll find all the information you need on where to find a specialist ethical financial adviser near you. Profiling members of the Ethical Investment Association (EIA), as well as looking into the history of financial advice more generally, after reading the guide you will be able to make a more informed decision about whether such an ethical adviser is most appropriate for you.” It’s a great guide, particularly for novice UK investors, interested in looking into ethical investing.
Introducing: The Guide to Ethical Financial Advice 2013, by Alex Blackburne, April 10, 2013, Blue&Green Tomorrow, UK.

Crisis Has Hit Companies′ Social Responsibility, Poll Suggests.– [COMMENTARY] “Some 74% of Brazilians, 65% of Chinese, 62% of Indians, and 44% of Americans believe their companies have taken corporate social responsibility (CSR) more seriously over the past decade… 39% of Europeans believe that companies pay less attention to their influence on society than they did 10 years ago, with 40% saying they pay more attention, putting Europe at the bottom of the international league table.” This probably also reflects the fact that developed country consumers are rating most of their institutions very poorly these days.
Crisis has hit companies′ social responsibility, poll suggests, by Marc Hall, April 5, 2013, EurActive, Belgium.

Transparent Investment Policies Can Boost Charity Donations.– [COMMENTARY] “Charity behaviour and investment transparency can positively influence potential and current donors, according to research by microfinance provider Oikocredit. Its study found that 48% of people donating to charity were more likely to donate to ones that made their investment goals clear. It also showed that members of the public were influenced stronger by a charity′s investment practices than its advertising.” It has always amazed me how many charities allow their fund managers to invest in companies whose activities run afoul of the charities’ own goals.
Transparent investment policies can boost charity donations, by Emma Websdale, April 5, 2013, Blue & Green, UK.

Twenty Years On, Corporate Sustainability Still Lacking.– [COMMENTARY] “After 20 years of rating corporate sustainability efforts, German-based oekom research has found that global giants have not been doing nearly enough in their commitments to sustainability. In its most recent annual report, oekom found that only one in six — 16.7 percent — of the companies rated has a “good” level of commitment.”

It’s not surprising that most companies are ’minimalists’ when it comes to encompassing sustainability. However, how much longer they can remain lazy about sustainability remains a question as stock markets, stakeholders and governments become increasingly involved in promoting it.
Twenty years on, corporate sustainability still lacking, by Robert Kropp, April 3, 2013, GreenBiz, USA.

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