Europe’s December SRI Fund Sales Hit 1-Billion Euros For The First Time. – [COMMENTARY] “… figures compiled for Responsible Investor by Lipper Feri, the investment data group. Total sales for the SRI sector for December, 2008 were €999.4m ($1.3bn) to take its overall value of to €35.4bn. Significantly, total SRI fund sales came out at 10% of the total European equity fund sales figure of just over €10bn in December, which suggests SRI fund sales are holding up well and increasing in comparison to their mainstream peers during the current economic market crisis. SRI funds typically represent around 1-2% of the total European equity fund market, which is valued at just over €1 trillion as measured by Feri.” Increasingly, investors are coming to believe that the best stocks that are good to invest in have an ethical and green hue to them.
SRI fund sales hit 1 billion euro mark in December, green sales positive, by Hugh Wheelan, Responsible Investor, UK.

Co-op UK Funding Anti Tar Sands Fight. – [COMMENTARY] “The Co-op banking and investment group is paying £50,000 ($71,000) to fund a legal action in Canada that could block the development of the country′s oil sands by companies such as Royal Dutch Shell and BP… The money will be used to fund evidence-gathering for the case being brought by the Beaver Lake Cree nation, an aboriginal community in Alberta, the province where the oil sands industry is based.” Together with the powerful environmental forces within the new Obama administration, investors in Canada’s oil sands are under siege as they have never been before.
Co-op to fund oil sands fight, by Ed Crooks, February 25, 2009, Financial Times, UK.

Global Government Green Stimulus Tops $200 Billion. – [COMMENTARY] This is good news for green investors and for the planet. This Reuters article says the US stimulus package contains $106 billion for green initiatives.
Global “green” energy stimulus hits $200 bln -bank, February 24, 2009, Reuters, USA.

Hampshire College States Fund Divestment Related To KLD’s SRI Analysis Of its Holdings. – [COMMENTARY] “In sum, what KLD found was that of the fund’s 455 holdings, well over 200 raised significant concerns relative to Hampshire College’s socially responsible investment policy and were in violation of values of socially responsible investing. It was on this basis that the investment committee voted as it did to exit from the fund when an alternative fund has been identified. The decision was entirely unrelated to Israel or the Israeli-Palestinian conflict.”

It seems to me that Hampshire College has set an excellent example of what all endowment and foundation funds should be doing — looking for ethical stocks that are good to invest in.
An open letter to Alan Dershowitz, by Ralph Hexter, president, Sigmund Roos, chair of the Board of Trustees Hampshire College, USA, published in The Jerusalem Post, Israel.

Excellent Discussions On The Relevance/Irrelevance Of The Gross Domestic Product (GDP) Statistic. – [COMMENTARY] I wrote this editorial, Retiring the GDP last May. I have recently become aware of some terrific new articles, developments and websites on the subject that I want to share with you. See below.
Worldwide Support Found for Measuring True Wealth of Nations, by Hazel Henderson, February 19, 2009, Chelsea Green, USA.
A measure remodelled, by John Thornhill, January 27, 2009, FT.com, UK.
A more humane way to measure progress, by Simon Briscoe, January 31, 2009, FT.com, UK.
National Accounts of Well-being, (website), UK.
Beyond GDP, (website), Belgium.

Innovest Strategic Value Advisors Being Purchased by RiskMetrics Group. – [COMMENTARY] “By combining Innovest′s ESG research with RiskMetrics leading capabilities in risk management and corporate governance, we can help investors make more-informed decisions.” — Matthew Kiernan. This is huge news in the ESG/SRI industry. I have known Matthew — a co-founder of Innovest — for a number of years. He has helped build Innovest into what many in the industry regard as the finest company on the planet engaged in sustainability research for institutional investors. I wish Matthew and all the team at Innovest the very best for a bright future!
RiskMetrics Group to Acquire Innovest, February 19, 2009, Innovest Strategic Value Advisors, Canada.

India’s First Shariah Compliant Mutual Fund Launched. – [COMMENTARY] “Introducing a newer concept in Indian mutual fund industry, [the] Taurus Ethical Fund, India′s first equity oriented Shariah compliant mutual fund, wherein investment will be made only in a universe of 152 companies in compliance with Shariah norms.” With its huge Muslim population as well as the growing interest in ethical investing, this fund could fill an important niche in the Indian mutual fund industry.
Taurus MF launches Taurus Ethical Fund, February 18, 2009, The Economic Times, India.

Australian Government Backs World’s First Responsible Investing Training Academy. – [COMMENTARY] “… a grant worth Aus$2.5 m (€1.25m) for the creation of one of the world′s first dedicated academies for training and education and research. The government has also asked the Australian Prudential Regulation Authority (APRA) to review its prudential guidance to Australian superannuation funds in a move that looks likely to see it recommend that funds take greater account of ESG issues in their investment decisions.” Well done Australia. Perhaps other governments will follow as the recognition of the importance of ESG (environmental, social and governance) factors to long-term investing become obvious to everyone.
Australian govt backs world′s first RI academy with Aus$2.5m, floats ESG law changes, by Hugh Wheelan, February 19, 2009, Responsible Investor, UK.

The Renewable Fuels Association (RFA) Slams University of Minnesota’s Ethanol Study. – [COMMENTARY] “… like several other highly controversial studies published recently, the conclusion that corn ethanol does not offer climate change benefits relative to gasoline is based almost entirely upon insufficient and extremely uncertain analysis of potential land use changes… If the authors′ [University of Minnesota] assumed land use change emissions are removed from the analysis, the paper suggests average corn ethanol reduces greenhouse gases by 30% compared to gasoline and advanced corn ethanol reduces GHGs by 46%.”

Wow, what a comeback from the RFA! They also say that, “Modern corn ethanol is displacing some of the need for gasoline from marginal sources of oil with high carbon intensity [i.e. Canadian tar sands, Venezuelan heavy crude, etc.]” It is clear that we need to be careful about taking studies at face value. You can only compare ’apples with apples’ and not ’apples to oranges.’ So as usual, more study is needed to help resolve the issue of ethanol’s carbon emissions. Personally though, I still do not like using food croplands for ethanol production.
RFA Analysis: Climate Change and Health Costs of Air Emissions from Biofuels & Gasoline, February 17, 2009, Renewable Fuels Association (RFA), USA.

DuPont Named ‘Most Responsible Company′ In China By China International Forum On Corporate Social Responsibility (CSR). – [COMMENTARY] “The award recognizes companies for their successful corporate responsibility during the past 30 years — since China′s economic reform… About 400 representatives from government agencies, enterprises and media attended the forum, which was broadcast by Phoenix TV, the most popular Chinese language TV channel in China.”
DuPont Named ‘Most Responsible Company′ in China, February 17, 2009, WebWire, China.

Consumers Rate America’s Greenest Brands.  – [COMMENTARY] Companies with high scores include, “Whole Foods, Trader Joe’s, Wegmans, Fresh & Easy, Publix, MOMs, Tom’s of Maine, Burt’s Bees, Green Mountain Coffee, Odwalla and Kashi, among others.” As these companies demonstrate, a green and ethical business environment continues to grow.
Whole Foods, Google, Trader Joe’s Among Consumers’ Greenest Brands: Report, February 17, 2009, GreenBiz, USA. Click here for actual survey results.

UNEP Calls For One-Third Of Stimulus Packages  Be For Environmental Investments To Get Global And National Economies Back To Sustainable Work. – [COMMENTARY] “This would assist in powering the global economy out of recession and onto a Green, 21st century path a new report released today by the UN Environment Programme (UNEP) says.”
Realizing a “Green New Deal,” press release, United Nations Environmental Program, February 16, 2009, Nairobi, Kenya.

Corporate Social Responsibility (CSR) Remains A Corporate Priority And Has Not Harmed Stock Performance In Downturn. – [COMMENTARY] “In the worst economic turmoil in decades, when investors had every reason to shed pretensions of political correctness, companies that put time and energy into behaving responsibly seem, thus far anyway, to have performed no worse than those that didn’t.”

I suspect that as the concern with corporate ethics rises and with investment analysts increasingly interested in how corporations score on environmental, social and governance factors, CSR will continue to grow. For companies, the advantages of using corporate social responsibility are getting more important with each passing day. And as investors become more critical of corporate performance, they are increasingly demanding it as well.
Responsibility Is Still Good For Business, by Christopher Flavelle, February 15, 2009, The Big Money Via The Washington Post, USA.

Congress Passes US Stimulus Bill. Includes Green Spending & Initiatives. – [COMMENTARY] It is a start in the recognition that green energy/tech do matter. Some green/ethical stocks and bonds could benefit as $45 billion is earmarked for promoting energy efficiency and renewable energy through new spending and tax incentives.
How will the $789 billion stimulus package affect you? By Sue Kirchhoff, February 13, 2009, USA Today, USA.

Turmoil Rocks Hampshire College Due To Divestments Associated With Companies Operating In Israel. – [COMMENTARY] “A pro-Palestinian student group and Hampshire College disagreed Thursday as to whether the Massachusetts institution′s withdrawal of investments from an index fund represented a rebuke of Israel, and a major first for the divestment movement… Dershowitz, a Harvard University law professor and well known supporter of Israel, threatened to unleash a campaign against the college, and issue a call for donors to withhold contributions, unless Hampshire resolves any ambiguities and clearly states that it rejects student efforts to divest from the Jewish state.”

Hampshire College withdrew its investment in a fund managed by State Street and says that the State Street fund violated Hampshire’s socially responsible guidelines. For ethical investors, this will be important to watch and to see if other college endowments gravitate to socially responsible investing- – and to see what screens they apply.
War of Words on Investments in Israel, by Elizabeth Redden, February 13, 2009, Inside Higher Ed, USA.

US Foundations Who Invested With Madoff Could Face Government Fines For Imprudent Fiduciary Oversight. – [COMMENTARY] “Under an obscure tax rule, private foundations can be penalized for failing to vet their investments properly, to heed red flags or to diversify prudently.” Here we have another reason why foundations have to bring higher ethics into their funds’ management and to re-think and re-align their endowments with ethical principles that mirror their mission goals.
For Investing With Madoff, Private Foundations Could Face Tax Fines, by Lynnley Browning, February 11, 2009, The New York Times, USA.

Report Reviews Social & Environmental Disclosure Using Case Studies In Brazil, France, South Africa & Sweden. – [COMMENTARY] “The initiatives in the five case studies presented provide models for similar regulatory action by U.S. agencies or stock exchanges to promote transparency and efficiency in U.S. markets.” An ethical business environment demands full disclosure and transparency. Because of the lack of this and to supposedly ’safeguard’ the system, unethical behaviour has been allowed to flourish. Only a new higher consciousness with some of the examples outlined in this report will turn the tide. Fortunately, some signs of this are appearing.
Innovations in Social and Environmental Disclosure Outside the United States, November 2008, Domini Social Investments and The Social Investment Forum, USA.

Conflict Of Interest! US Congressmen On The House Financial Services Committee Received Big Campaign Contributions From Banks Getting TARP Funds. – [COMMENTARY] “Rep. Jim Himes (D-Conn.)… represents a state that is home to many hedge funds, insurers and other financial institutions, collected the most from these companies in the 2008 cycle at $195,350, followed by ranking member Rep. Spencer Bachus (R-Ala.), who collected $116,950. JPMorgan has been Bachus’s second-largest donor over time, giving him at least $96,000 since 1989. The eight financial institutions at Wednesday’s hearing have given $63,250 to the chairman of the committee, Rep. Barney Frank (D-Mass.), and JPMorgan has given him more money than any other company, union or organization since 1989. The House Financial Services Committee has jurisdiction over the housing and financial sectors.”

How can the public have confidence in the House Financial Services Committee to act on their behalf when its members are beholden to these same banks and investment firms for their electoral finances? It makes a mockery of Congresses’ oversight mechanism of financial services.
Congressmen Hear from TARP Recipients Who Funded Their Campaigns, by Lindsay Renick Mayer, February 10, 2009, OpenSecrets.org, USA.

KKR, The Blackstone Group, & The Carlyle Group, Among Leading Global Private Equity Funds Agreeing To Incorporate ESG In Research Analysis. – [COMMENTARY] “The member firms of the Washington, DC-based lobbying group Private Equity Council [PEC] have signed on to a set of socially responsible investment guidelines. Member firms include Bain Capital Partners, TPG, Permira, The Blackstone Group, Apollo Global Management, The Carlyle Group, Apax Partners, Hellman & Friedman, Kohlberg Kravis Roberts, Madison Dearborn Partners, Providence Equity Partners, Silver Lake and Thomas H Lee Partners.”

This is a big breakthrough for ethical investing! Read the article and believe that short-sighted, short-termism that lead to so many of our financial difficulties today, is dying, and now being replaced by the longer term inclusion of environmental, social, and governance (ESG) factors. The PEC themselves also appear to believe that this new orientation can lead to greater profits — which is what ethical investors have long maintained will be the inevitable consequence of including ESG in investment analysis.
Mega-firms embrace socially responsible investing, by Christopher Witkowsky, February 10, 2009, Private Equity Real Estate, USA.

Green America Says Wachovia, Wells Fargo, & Suntrust Are America’s Best Large Banks. – [COMMENTARY] You have to dig to try to find out how they arrived at these findings. Also, Green America says they have too little information to rate them on many of the variables, so it makes you wonder how valid are the overall scores. However, this information is useful reviewing if you are interested in socially conscious banks.
Banking and financial, Green America (formerly Co-op America), USA.

Islamic Funds Outperforming Benchmark Indices. – [COMMENTARY] “Dow Jones Islamic Market Indexes, which represent benchmarks for Islamically correct investment categories, have been outperforming their non-Islamically compliant counterparts by 3 to 4 percent in key indexes. The two Amana Income and Growth funds, the largest Islamic mutual funds in the country [USA] with $1.2 billion in combined assets, have been outperforming the S&P 500 in the past year by 13 and 7 percent, respectively. (Both Amana funds also outperform the S&P index on 5- and 10-year comparisons.)”

Investments in Islamic funds have to meet strict ethical and spiritual guidelines. Thus they have avoided the worst excesses of the current financial disaster. Values-based investors also might want to look into the ethics and theoretical underpinnings of Islamic finance to help them in their investment decisions.
Muslim investors profit by adhering to faith, by Matthai Kuruvila, February 9, 2009, San Francisco Chronicle, USA.

US Consumers Still Buying Green Products. – [COMMENTARY] “The 2009 National Green Buying survey by Green Seal and EnviroMedia Social Marketing found that half of consumers are buying just as many green products now as they did before the economic downturn began. An additional 19 percent are buying more products than before, and 14 percent are buying fewer green products.” This is good news for green investors, the environment, and the global economy.
Consumers Still Buying Green Through Economic Changes, February 9, 2009, GreenBiz, USA.

University of Minnesota Study Suggests That Corn-Based Ethanol More Harmful & Costly  Than Gasoline. Cellulosic Ethanol Holds Promise. – [COMMENTARY] “According to the findings in this study, for each billion gallons of fuel produced and expelled into the air through a vehicles exhaust, the combined health and greenhouse costs are $469 million for gasoline and somewhere between $472 million to $952 million for corn ethanol… [and] $123 million to $208 million cost was associated with the use of cellulosic ethanol…”

Corn-based ethanol is proving to be bad in every way. For ethical investors, cellulosic ethanol, made from wood chips, plant waste, grass, etc., could be well worth watching though.
New Study Finds Corn-based Ethanol More Harmful Than Oil-based Gasoline, by Eric Leech, Treehugger, USA.

Morningstar’s Guide To Green & Socially Responsible Investing (SRI). – [COMMENTARY] This is a useful overview of green/SRI investing with particular reference to SRI mutual funds in the US.
The Morningstar Guide to “Green” and Socially Responsible Investing, Morningstar, USA.

Forbes Magazine Features Advisor’s Choice Of Ten Top Green Stocks. – [COMMENTARY] His choices include GE and United Technologies. Some ethical investors may certainly argue the merits of these companies. However, there are others among the chosen ten that ethical investors could live with.
Green your portfolio, by Charles Carlson, February 3, 2009, Forbes.com, USA. (Click on the “In Pictures: 10 Green Dividend Reinvestment Plans.”)

2nd Annual Survey Of The State Of Green Business By GreenBiz Shows Little Change. – [COMMENTARY] The report has some interesting statistics concerning US energy use, green patents, etc.
State of Green Business 2009: Green is Growing, But Not Fast Enough, February 2, 2009, GreenBiz, USA.