E-newsletter of Investing for the Soul April, 29 2016
Top ethical investing news for April 2016
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!
ESG Materiality Without (Comparable) Metrics? Back to the future of financial reporting? "What if a firm could pick and choose which element(s) of its financials on which it would report? What if each firm could define its reporting categories on its own (think of choosing one or more contemporary non-GAAP financial reporting categories, e.g. pro forma, operating earnings, EBITDA, cash earnings, or some combination, any combination, or something else)?
Indeed, what if a firm’s Board could define which financial data points were material? What if a Board could determine when it should release information? How would publics (investors and others) judge a firm’s value, potential, strength/weakness, and how would comparisons be made?"
situation cited above was once the reality of financial reporting that
investors had to deal with before the 1930s. We would think it
ridiculous that such information and reporting were not standardized as
we have it today. Yet, ESG/materiality reporting is now in much the same
state as financial reporting all those decades ago. This article is a
great read and the author makes a good case for establishing ESG/materiality
Millennials set to drive major growth in Canadian RI. "82% of millennials surveyed believe that RI will become more important in the next five years, with two-thirds of saying it is important for their advisors to be knowledgeable about RI issues and trends."
Abbey, CEO of Canada's Responsible Investment Association (RIA), reports
on an impressive and important new Canadian study on the present and
potential future investing actions of millennials, boomers, and Gen Xers.
The studies' findings show that millennials are extremely interested in
RI! Even if you're not Canadian, the reports' findings are really worth
G&A Institute and Bloomberg LP Partner to Examine Bloomberg ESG Disclosure Scores For S&P 500 Companies Reporting VS Not Reporting on Sustainability. "Results Show Companies Not Publishing Sustainability Reports Are Disadvantaged by Lower Average Bloomberg ESG Disclosure Scores."
companies not reporting on their environmental and social activities are
most penalized. Non-reporting companies must realize that not improving
internally on ESG matters and not reporting their performance on those
metrics will be increasingly penalized -- from relatively poor stock
performance to credit costs.
66% of Quebecers would allocate a portion of investments to responsible investing. "While only 46% of Quebecers have heard of responsible investing (RI), 66% said they’d be willing to allocate a portion of their investments to it when told about this option. Responsible investing may have topped the $2 billion mark at Desjardins, but Quebecers’ interest in RI suggests this kind of investing could grow by leaps and bounds in the coming years."
is a trendsetter in many areas of social development. It could also lead
Canadian investors in their adoption of SR-ethical investing!
(US) DOL Bulletin Hampers Social Impact Investing. "The bulletin implies that the act of voting or otherwise addressing long-term environmental, social and governance (ESG) risks are unrelated to the provision of benefits.
'We believe the bulletin is out of date,' said Meg Voorhes, director of research with (US SIF), an organization dedicated to advancing sustainable, responsible and impact investing across all asset classes.'"
how companies perform on ESG measures has very real consequences for
their future profitability. Yes, this DOL bulletin is
Ethiquette® new, independent, Canadian university-based responsible investment website. "Ethiquette®... developed and managed by the Responsible Consumption Observatory (RCO) of UQÀM’s School of Management Sciences (ESG UQÀM) and Ellio.... A crossroads for dialogue and the sharing of information by responsible investment stakeholders in Québec and Canada (organizations, NPOs, media and government), Ethiquette aims first and foremost to help individual investors as they venture into the realm of responsible investment."
is a terrific new site for Canadians and others seeking knowledge about
responsible investing (RI). It offers information on RI products,
strategies, resources and more...
Veres: (US) Professional Advisors Already Winners with Fiduciary Rule. "The Department of Labor’s announcement of its long-awaited, long-debated fiduciary rule for retirement plan advice will be remembered as a milestone in the history of the industry. To put it simply, professional financial planners and advisors have achieved a victory, and the Wall Street and independent broker-dealer service models have been dealt a blow."
is a terrific step forward for average American investors. It now says
that brokers have real fiduciary responsibility to their clients and are
not simply salespeople!
PRI says now is the time to act on ESG in credit ratings. "Investors across our signatory network are being asked to support a call for credit rating agencies to incorporate ESG into their credit analysis in a more systematic and transparent way. In May last year our survey received responses from 99 investors who showed strong support for an initiative on credit ratings, with 78% wanting to see ESG more explicitly in ratings."
is a timely call for all involved in ethical investing to get behind
PRI's call to encourage credit rating agencies to integrate ESG factors
into their credit ratings!
Controlled Companies Underperform, Boards Less Diverse New Study Finds. "The study finds that controlled companies generally underperformed non-controlled firms over all periods reviewed in terms of total shareholder returns, revenue growth, and return on equity."
[COMMENTARY] Controlled firms refer
to companies controlled by a major stockholder. The study suggests that
diversity of boards and ownership provides better governance and lower
CEO pay, among many other findings.
Rolex, Disney, Google Top World’s Largest Survey of Corporate Reputations. "The RepTrak® System measures the general public’s perception of the world’s top companies on the seven key rational dimensions of reputation: products and services, innovation, workplace, governance, citizenship, leadership and performance."
[COMMENTARY] Many ethical investors
might query some of the top names on this list. However, it's all about
perception and perception influences markets -- and stock prices. This
is always a noteworthy list to peruse.
90% of (global) retail investors have trust in financial services: Survey. "Investors expect higher levels of transparency than ever before, holding their investment managers to the highest ethical standards, and are laser-focused on returns, according to a recent study from CFA Institute, the global association of investment management professionals."
[COMMENTARY] As it's the CFA
Institute who compiled the survey it is useful reading for all in the
investment industry. Compared to other surveys of trust in the
investment/financial industry, this one paints a relatively rosy
picture. (For CFA's actual report,
Note: Articles are linked to the original source. Some sites may require registration, and may, or may not, archive stories. All links were active at the time of publication.
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 © 2016 Ron Robins. All rights reserved.