The wakeup call for sustainability is loud and clear. A new era of sustainability is emerging, and it’s affecting every aspect of the world. Consumers are increasingly motivated to be more environmentally and socially conscious and are exercising their power and voice through the products they buy and the companies that they invest in. According to Hotwire:
- 47% of internet users worldwide said they had switched to a different product or service because a company violated their personal values.
- Protecting the environment topped the list of reasons consumers switched, and 5% cited concerns about climate change.
Balancing act of benevolence & bankable
Corporations are stepping up to sustainability, understanding that this just makes good business sense. According to our latest whitepaper Finance for Good: The Positive Impact of Active Ownership, we see a shift in shareholder resolutions with focus on environmental and social factors. And, an increasing number of institutional investors are backing these resolutions.
Companies do well by doing good
From our own proprietary research, we’ve seen that firms with more gender diversity on Boards and higher social factor scores perform better as a standalone measurement. Despite the economic downturn in the first quarter of 2020, socially-minded companies lost significantly less than those without a sound socially-conscious strategy.
In 2019, shares of the 100 companies on Barron’s “America’s Most Sustainable Companies” list returned 34.3% on average, beating the S&P 500′s 31.5%. It’s clear that sustainable investments - those focused on companies with strong environmental, social and corporate governance (ESG) principles are filtering into the public consciousness. The adverse effects of material issues such as climate change, gender inequality, financial exclusion, and resource scarcity are a wakeup call to stakeholders and shareholders, alike. Our view at Aneuvia Asset Management is that sustainable investing not only increases intrinsic value, but also produces greater financial returns.
Learn more about Aneuvia’s sustainable investing solutions.