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This is a Huge Market!

1 of every 5 dollars of professionally managed assets in the U.S. is now invested with some consideration for environmental, social, and governance factors (ESG), representing growth of 33% between 2014 and 2016.*

$11.2 trillion in assets are controlled by women investors in the U.S. and 76% of women investors are interested in sustainable investing.**

84% of millennial investors are interested in sustainable investing.***

Investing in What You Believe In

“Investing in sustainability has usually met, and often exceeded, the performance of comparable traditional investments. This is on both an absolute and a risk-adjusted basis, across asset classes and over time.”

- Morgan Stanley

Source: MSCI ACWI ex Fossil Fuels fact sheet: MSCI ACWI EX FOSSIL FUELS INDEX (USD)

Past performance is not a guarantee of future results and the performance quoted does not represent the performance for any investments recommended by our firm

Research suggests that business efficiency and long-term performance increases when Environmental, Social, and Governance (ESG) factors are integrated into investment analysis and portfolio construction.

It makes sense that a large amount of money is flowing into ESG accounts as indicated in the chart below. 

Tobacco-related restrictions saw the greatest growth of any ESG criteria, increasing 432 percent from 2016 to $2.9 trillion

However, climate change was the most important specific ESG issue considered by money managers in asset-weighted terms; the assets to which this criterion applies more than doubled from 2016 to 2018 to $3.0 trillion.

Conflict risk was the leading social criterion at $2.3 trillion assets under management, but assets managed with human rights criteria were next at $2.2 trillion and experienced much larger growth from 2016.

Sustainable Investing ESG Screening +  Shareholder Advocacy Impact Investing

Examples of ESG: Environmental, Social,

and Governance Factors

Value-Based Screening - Excluding or including industries or sectors based on values or ethics determined by the investor 

Sample exclusions: Gambling, tobacco, alcohol, nuclear power, weapons, fossil fuels

 

Sample inclusions: Renewables,  sustainable agriculture systems, companies making environmental stewardship efforts, and/or companies valuing human capital

 

Shareholder Advocacy

The process through which shareholders use their access or clout to press companies to change their practices. 
 

Step #1 – Company Engagement

Action

•Dialogue

•Inquiry Letter

•File shareholder resolutions

  Impact

•Increased transparency for shareholders

•New or improved policies reducing potential risks

Step #2 – Meetings

Cons

•Dependent on others for issue generation

Votes are non-binding

 Action

•Private meetings

Impact

•Share concerns with company

•Learn company’s understanding of issues and any plans to address them

Cons

•Any specific information gained is only known by one shareholder

•Brand reputation damage & other  potential risks may still exist for  shareholders

Step #3 - Proxy Vote or Withdrawal of Resolution

 Action

•Voting proxies with ESG criteria, or

•Resolution is withdrawn

 Impact

•May become binding

•Company agrees to do more to satisfy shareholder concerns

Cons

•Resource intensive and used by very few shareholders

COMBATING CLIMATE CHANGE THROUGH FOREST PROTECTION

Forest Protection Campaign Results

•Kellogg’s becomes one of first to protect Southeast Asian rainforests and by 2016 implements its policy across 94% of supply.

•Asia’s largest agribusiness Wilmar announces groundbreaking no-deforestation policy with Unilever, publicly thanking Green Century Funds.

•Green Century Funds organizes investor support for Indonesian moratorium on new plantations.

1.5 Gigatons of carbon pollution saved annually from the planet by use of sustainable farming

850 Hectares saved from Slash & Burn 

Perhaps you wonder why it is so important to

Protect our planet's Forests

The answer is:

Plants intake carbon dioxide and respire oxygen.

The scientific community has established that excess carbon dioxide from burning fossil fuels is the chief cause of global warming.

Companies that don't take this to heart have increased supply chain risk as well as a risk to their reputation.

Shareholder Advocacy Highlights – as reported in the June 30, 2018 Trillium Report

J.B. Hunt received 21.4% shareholder votes supporting an initiative to set

 

science-based greenhouse gas reduction targets (sending the message that

 

meeting the objectives of the Paris Climate Control agreement is a sign of

 

corporate responsibility that investors want).

Other Shareholder Advocacy Highlights Reported on https://www.asyousow.org

In August, 2018, the following resolution was submitted to Tyson Foods, Inc

 

by As You Sow and American Baptist Home Mission Society:

 

BE IT RESOLVED: Shareholders request the Board of Directors prepare a

 

report, at reasonable cost and omitting proprietary information, on Tyson’s

 

human rights due diligence process to assess, identify, prevent and mitigate

 

actual and potential human rights impacts.

 

Status:  Pending

Active Shareholder Advocacy 3rd Party Money Managers Available Through Our Investment Firm

The Process of Building Portfolios Using Environmental, Social, and Governance Factors (ESG)

Identify companies that rate the highest on ESG issues as compared to others in their industry

Assess management quality, risk exposure, and exposure to long-term systematic risks

Use best in class determinations of companies' approaches on issues of concern to investors

How we Compare Investments using Environmental, Social, and Governance Factors

Natural Investments      Ratings

Evaluates ESG strategies and management of the 165 funds who  have a stated SRI or ESG mandate

Began evaluating in 1992

Features sector exclusions, shareholder advocacy openness, and participation in community investing

Scores based on absolute terms of breadth and depth – not a bell curve

Morningstar Sustainability       Rating

Based on data provided by Sustainalytics

 

  • Assesses ESG criteria > 6500 companies

  • Adds a scoring of controversies for these companies

  • Distributes fund scores across a bell curve in each sector within Morningstar categories

 

Intentional commitment to SRI and ESG values have no bearing on scores. Nor are additional SRI practices considered

Why might investors  avoid fossil fuel companies?

  • A desire to align investments with climate change needs by avoiding oil, coal, and gas companies.

 

  • To take away the “social license” and diminish the clout the industry has on public policy.

  • To re-invest in clean and sustainable solutions now competitive with oil, coal, and gas companies.

 

  • To diminish financial risk associated with oil price volatility and stranded assets such as plants under construction  never reaching completion. Expensive offshore or Arctic drilling drains capital that otherwise may be returned to shareholders as dividends.

Your Next Steps

If you like the idea of investing in what you believe in and excluding

 

sectors and companies that you don't want to support, work with a

 

financial advisor (me) familiar with socially responsible investing who


can help you determine what’s important to YOU.

These United Nations' Goals are Attainable!

I am an\ Investment Advisor Representative with an Arkansas Registered Investment Advisor firm, Advanced Retirement Solutions, Inc. Our firm boasts investment advisors with many years of experience. My particular expertise is in the Socially Responsible field of investing.

 

My insurance agencies, TalkMedicare and TalkRetirement are not registered entities and are not subsidiaries or affiliates of Advanced Retirement Solutions, Inc.

 

I help my clients direct their investment capital to (a) make

money and (b) make a difference with their money to reflect their

priorities for society at large!

My Education & Certifications

1989 -- Bachelor of Science in Agricultural Economics (BSA) with a Minor in Environmental Science –

 

University of Arkansas

1992 – Master of Science (MS) in

Agronomy – University of Arkansas

1998 – Doctorate of Adult Learning (Ed.D) – University of Arkansas

 

2012 – Financial Planning Certificate – University of Georgia

 

2016 – CASL® Chartered Advisor for Senior Living – The American College

 

2018 - AIF® Professional, Accredited Investment Fiduciary™ - Fi-360