Environmental Social & Governance (ESG)

Sustainable investing* seeks to empower investors to grow their wealth while still aligning with their values, beliefs, and goals for our communities and our planet. With greater transparency, research, and due diligence – portfolios construction seeks better returns and lower risk while embracing principle.

Environmental criteria considers how a company performs as a steward of nature. This includes action on climate change, greenhouse gas emissions, and reductions in water usage.

Social criteria examines how a company manages relationships with employees, suppliers, customers and the communities where it operates. Themes include labor standards, health and safety performance, and the way a company treats clients and customers.

Governance criteria deals with a company’s leadership, executive pay, audits, internal controls, and shareholder rights. This includes anti-corruption measures, tax transparency, and how decisions are made across the executive board.

Why is this so important?

• Proactive Adaptability. Evolving business models minimize the impact of disruption from technology or regulation.
  
  
• Better Prepared for Regulation The adoption of or investment in renewable energy infrastructure and technology to reduce carbon emissions and costs arising from environmental tax or payments for offsetting carbon emissions.
  
  
• Capitalizing on Innovation. Technological advancements in fostering a sharing economy that promotes innovation and improves efficiency.
  
  
• Cashing in on Positive Brand Image. Companies with high ESG values may experience better retention rates and a more positive brand recognition amongst their staff and customers.

MSCI Inc. is the world’s largest provider of Environmental, Social and Governance (ESG) Indexes designed to help investors more effectively benchmark ESG investment performance and manage, measure and report on ESG mandates. The MSCI KLD 400 Social Index consists of 400 companies selected from the MSCI USA IMI Index, which includes large-, mid- and small-cap US companies.

Some may worry that by closely aligning their investments with their values, the return potential will ultimately be limited. Rest assured; impact investing aims for strong financial performance in addition to making a difference.  Bottom line, for those who are looking for greater transparency in hopes of making better decisions, we can help.

* Environmental Social Governance (ESG) investing has certain risks based on the fact that the criteria excludes securities of certain issuers for non-financial reasons and, therefore, investors may forgo some market opportunities and the selection of investments available will be smaller.