What is Socially Responsible Investing?
Social investors recognize that every financial transaction has social implications as well as monetary ones. While traditional investing is aimed exclusively at maximizing financial value, social investing takes account of both financial and social bottom lines. Socially responsible investing can be a catalyst for positive social change or merely a way to help the investor sleep better at night. See our services »
News & BlogFebruary 23, 2015
For three consecutive years, the Thirty Percent Coalition, formed in 2011 to promote gender diversity in corporate boardrooms, has been formally reaching out to the Russell 1000 Index companies in letter-writing campaigns that have attracted signatories managing more than $3 trillion worth of assets. Clean Yield was pleased to sign on to the Coalition’s latest letter, sent in October 2014.
A recent press release from the group celebrated some incremental successes and drew attention to investor pressure in support of greater board diversity. It highlighted the 25 shareholder proposals calling for greater board diversity (along racial as well as gender lines) that have been filed to date this year.
It also noted that lack of board diversity was one of the selection criteria used by the New York City pension funds in targeting 24 companies for proposals seeking the right to nominate board candidates. (Yes, you read that correctly. Shareholders do not have a default right to nominate corporate board directors.)
The good news? The Thirty Percent Coalition announced that as a result of these efforts, 17 companies contacted have appointed women to their boards. This is good, of course, but how much of a dent does it make? Read more »Comments » February 13, 2015
Vermont’s state senate is considering a bill, S.28, to require the state’s pension managers to divest retirement holdings from the world’s 200 largest publicly traded fossil fuel companies by 2020. This is the third year in a row that the legislature is considering divestment legislation, and I have testified in favor of the legislation each year.
State Treasurer Beth Pearce remains firm in her opposition to divestment, citing reduced investment returns, increased financial risk, and the opportunity to influence fossil fuel companies through her office’s membership in the Investor Network on Climate Risk.
On February 12, I delivered testimony in favor of the bill before the Senate Government Operations Committee in Montpelier. With a deep sense of deja vu, I repeated my rebuttal to the Treasurer’s financial arguments, which continues to be based on a deeply flawed study that misleadingly asserts that divestment will hurt investment returns and dramatically overstates both transaction costs and the magnitude of the portfolio risks that would ensue from divestment. In fact, studies have shown that a fossil fuel free index could have outperformed broad U.S. stock benchmarks over the trailing 25 years with only a miniscule increase in overall volatility (risk). Read more »Comments »
Company ProfilesDecember 12, 2014
HCP (ticker: HCP), based in Irvine, California, is a real estate investment trust (REIT) that owns and manages healthcare real estate.
The healthcare sector of the economy has compelling demographics that are expected to lead to increased demand for products and services, including senior housing and medical care. The healthcare industry is the largest in the U.S. and is projected to grow 6% annually from 2014 through 2022. The healthcare real estate sector seems particularly attractive and may be insulated from some of the cost pressures elsewhere in the healthcare system. Furthermore, less than 15% of the U.S. healthcare real estate market is owned by public REITS such as HCP, so there are also opportunities to grow through acquisition of existing properties.
HCP seeks to reduce risk in several ways. It typically uses long-term leases that have contractual rent increases (a majority of leases expire after 2023). The company also generally uses a “triple-net lease” structure, in which tenants effectively pay all property-related expenses (real estate taxes, building utilities and insurance, and common-area maintenance capital expenditures).December 12, 2014
As evidence continues to mount that the world is heating up at an alarming pace, the shift from fossil fuels to clean, renewable energy sources has taken on increasing urgency. One of our latest investments is a company that is making a significant contribution in advancing renewable energy across the country. Hannon Armstrong Sustainable Infrastructure Capital (NYSE: HASI) is a specialty finance company that finances infrastructure projects that enhance energy sustainability. Hannon provides financing for three types of projects: clean energy, energy efficiency, and other sustainable infrastructure.
Hannon Armstrong’s senior management thinks that climate change is the defining issue of our generation and that finance has much to contribute to the adoption of low-carbon technologies. Hannon focuses on the large opportunity to provide financing for distributed energy assets, which include assets that either reduce energy consumption (like LED lighting) or reduce carbon in energy production (like solar on buildings). Most of these distributed energy assets need the financing that Hannon provides. Founded in 1983, this Annapolis, Maryland-based company went public in 2013 and is structured as a real estate investment trust (REIT). With more than thirty years of experience in financing sustainable infrastructure projects, Hannon fills a void that often is left by traditional lenders and Wall Street. Read more »
Have Clean Yield’s news and blog posts sent directly to you via email or RSS.
Learn more »