ESG (Environmental-social-governance) investing affords investors an opportunity to have an impact.
When it comes to investing, knowledge is power. If you know which public companies are working to make the world a better place, you can strategically invest and funnel your money to issues you care about. Positive investment returns and social impact do not have to be mutually exclusive.
In order, however, to understand what ESG Investing can mean for you, we must first understand what it is.
ESG Investing – What Is It?
The U.S. News and World Report defines ESG investing as, “Buying into companies with responsible policies and a positive impact on the environment and their communities, while also having a corporate structure that’s fair for both stakeholders and shareholders.”
ESG investing is also commonly referred to as sustainable investing, impact investing, or socially responsible investing (SRI).
While the definitions of ESG investing can vary, they all embrace the intention of generating a measurable and positive impact on the environmental, social, or governance operations and policies of a public company; while also producing positive financial returns.
There was a time when ESG investments were made mostly by large, institutional investors. Today, ESG investing is available for all investors and is more topical in our social discourse than ever before.
Why ESG is Relevant
Everyone has issues they care about, and everyone can be connected to those issues with ESG investments.
ESG investing is becoming more popular, especially among the younger generations. A recent Morgan Stanley survey indicates that three quarters of investors – including almost nine of every ten millennials- are interested in sustainable investing.
Today, the energy behind a “force for good” is more alive than ever before.
In 2017, events like the People’s Climate March and The Women’s March, brought younger and older generations together to protest issues such as gender inequality and climate change.
ESG portfolios can be aligned to companies who care about and are dedicated to issues that might be important to you, such as:
- Environmental issues: climate change, carbon emissions, water stress, green technology, energy management, renewable energy, sustainable agriculture, ocean health, animal welfare, etc.
- Social issues: gender equity, mental health, healthcare, human capital, labor standards, privacy and data security, etc.
- Governance issues: board transparency, leadership, ownership, corruption, business ethics and fraud, accounting, etc.
As you can see, ESG investing touches many areas of our lives, and encompasses issues that affect all of us. Investors connect to these ESG topics, and can be financially empowered with ESG investment knowledge.
ESG Investment Knowledge is Power
As a consumer, and as an investor, you have the power to make financial decisions based on the way a company behaves. But you cannot do that unless you have real-time knowledge of what goes on inside these public companies.
Transparency leads to knowledge, which leads to financial empowerment.
Newday Impact Investing
As we create more portfolios that connect to a broader range of ESG themes, we provide information and support to our clients who are looking to, “Get Informed, Get Involved, and Get Invested”.
By providing access to our impact investing tool, we hope to create financial empowerment for everyone. Tell us what matters to you, and let us help you make your investments count.