E-newsletter of Investing for the Soul February 27, 2010
Top ethical investing news for February 2010
Links may only be valid a limited time Commentaries by Ron Robins
Swiss Fund Manager Vontobel Says
Sustainable Investment In Asia Could Climb From Current US$20 Billion Up
To US$4,000 Billion By 2015. -
billion number is certainly an eye catcher! There is no doubt in my mind
that sustainable investing in Asia is still in its early stages and will
grow enormously in the years ahead--and probably much faster than their
rapidly growing economies as well. We only recently became aware that
China is outspending and outpacing the US in green tech.
Company Carbon Ratings Announced By
Environmental Investment Organization (EIO).
"For the first time a Ranking has been created which penalises and
rewards companies on a global scale against absolute emissions with a
particular emphasis on the reliability of the data being provided. The
effect of the Rankings is first and
This is an
idea whose time has come. Ethical investors can see the rankings of most
of the world's big companies. The methodology of how they construct the
rankings is also available. This ranking system might be one that many
ethical investors will want to follow.
US Study Says Vice Fund (VICEX)
Outperformed Domini Social Equity Mutual Fund (DSEFX) Over Long Term,
But Not In 2009. -
"We examine the performance of socially responsible investing (SRI)
vs. vice investing through sin funds. Our research shows while the
annualized return of SRI through Domini Social Index (DS 400 Index) from
1990 to 2009 has been higher than that of S&P 500, the relative 5 and
I believe we are entering a very different
investment world now. The emphasis on environmental, social, and
governance (ESG) criteria, plus the rising concerns about ethics, point
to potentially superior long term results for ethical investors. Perhaps
the past year where ethical funds performed really well against their
conventional peers is indicative of the trend I foresee.
International Brands Disclosing Global Forest Footprint. - [COMMENTARY] "A Report published today by the investor-backed initiative the Forest Footprint Disclosure (FFD) project reveals the names of those businesses that have responded to its first call to disclose details of their ‘Forest Footprint’. This term indicates the extent to which procurement policies for Forest Risk Commodities (FRCs) such as palm oil, soy, timber, beef, leather and biofuels are linked to deforestation. The Report identifies two high profile British High Street names as ‘Best Performers’ in their sectors – Marks & Spencer (General Retail) and Sainsbury’s (Food and Drug Retail)."
looking at what the companies report--or do not report--is a worthwhile
exercise for ethical investors. It just might affect one's holdings.
Corporate Water Usage Risk Unmeasured.
"Unfortunately, the vast majority of large publicly traded companies
are failing to adequately manage and disclose the risks they face from
water scarcity, an issue that will likely become more acute as the
world's population increases and the future impacts of climate change
come to pass, according to new Ceres research." This is a subject
ethical investors need to be aware of as it breaks upon the
consciousness of investors generally. Water management and costs will be
a huge consideration for companies in the not so distant future and
could significantly affect financial results and stock prices.
What Companies Are Green? Wide Gap
Between Public Perception & Reality. -
"New research suggests some of the world's largest companies are
still struggling with communicating their environmental efforts to
customers. The latest installment of MapChange 2010 -- a joint effort
from Change, a Canadian consulting firm, Angus Reid Public Opinion, and
the nonprofit Climate Counts -- measured actual and perceived
sustainability efforts of major consumer shipping, food service and
banking companies, using a scale of 0-100." Amazing what good PR can
do. Companies with terrible sustainability scores such as Wendy's
International and Burger King score well on sustainability according to
More Large US Companies Boycotting
Canadian Tar Sands Oil. - [COMMENTARY]
"... two Fortune 500 companies announced plans to eliminate the
high-carbon Alberta fuel from its supply chain. The U.S.-based firms
Whole Foods Market Inc. and Bed, Bath and Beyond Inc. both unveiled new
fuel policies designed to wean themselves off 'higher-than-normal
greenhouse gas footprints' inherent in feedstock from the Alberta tar
sands." Despite the action of these large retail firms--and even if
US companies increasingly boycott tar sands oil--companies from China,
South Korea, and possibly even Japan, may well fill the gap by buying
more of that oil. The need for a global climate change solution is
evident by what is going-on with tar sands oil.
Investors Step Up Pressure On Corporate
Responsibility Reporting. -
"A coalition of global investors from 13 countries, managing over
US$2.1 trillion of assets, today added its voice to the increasing calls
for better corporate reporting on environmental, social and corporate
governance (ESG) activities. The international investor coalition is
writing to 86 major companies urging them to honour the reporting
requirements of the United Nations Global Compact, the world’s biggest
Most likely the majority of these companies
are listed on stock exchanges in the US. Therefore, they now fall under
the recently announced SEC guidelines requiring disclosure of any
material impacts of climate change on corporate activities. Nonetheless,
it is great that such a powerful investor group voices its concern on
disclosure. See my related editorial,
We Need Mandatory Corporate Social Responsibility (CSR) Reporting.
Mercer Study Finds Equity Fund Managers
Trading More Frequently Than They Think Appropriate.
"Some active equity fund managers have higher portfolio turnover
rates than they themselves claim, a new study finds. Nearly two-thirds
of institutional investor-focused investment strategies exceeded their
expected turnover from June 2006 through June 2009. Of these strategies,
the turnover was on average 26
As I mentioned in a previous report, stock
turn-over rates are appalling in many funds. This Mercer study further
supports that comment. Funds say to investors, invest for the longer
term, yet they turn-over their entire portfolios once or more each year!
And we wonder why the markets are a casino. I suggest that ethical
investors quiz their fund managers on this issue.
Social Investment Organization (SIO)
Produces Canadian Guide To Socially Responsible Mutual Fund Companies.
"All of the firms listed in this Directory are Sustaining or
Associate Members of the SIO. As Canada’s national association for
socially responsible investment, the SIO raises public awareness of SRI,
educates the financial community and the public about SRI and takes a
leading role in furthering the use of SRI." This is a very useful
guide for all Canadian ethical investors.
Geography Affects Corporate Social
"The geographic location of a corporation's headquarters affects its
approach to social responsibility, according to research supported by
the Arthur W. Page Center for Integrity in Public Communication at Penn
State. Seventy-five percent of Japanese firms, for example, give
I do not think anyone is too surprised by
the data here. However, this article mentions a new searchable website
CSR-Pedia. It says that it follows CSR activities of over 600
Banks Sign On To Be Green--But Fail When
Providing Loans. -
"The study assessed the performance of a group of leading financial
institutions -- Crédit Agricole, HSBC and Standard Chartered and
insurance groups Munich Re and Swiss Re -- against the Climate
Principles, a set of green investment guidelines launched by the Climate
Group in 2008 and endorsed by the five companies. It found that while
the companies had made strides to reduce their carbon footprint, they
scored badly in a review of the
have to be found to reward bankers making greener loans. They could be
based on the amount of carbon saved over the years of the project when
compared to some type of benchmark. Unless some such device can be
found, or by global financial industry/government rules in this area, I
doubt if any of the major banks will do much about this problem in the
Thirty US Institutional Investors Demand “Say On Pay.” - [COMMENTARY] "
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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 © 2010 Ron Robins. All rights reserved.