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Many of us are concerned about Climate Change. We replace incandescent light bulbs, drive less, buy carbon offsets when traveling and above all else we DO NOT BUY BOTTLED WATER. However since most of us are not institutional investors, pension managers or Richie Rich types with huge stock portfolios, we feel a little left out when it comes to Fossil Fuel Divestment.
An online survey by First Affirmative Financial Network found the following:
Over half of sustainable, responsible, impact (SRI) investment industry professionals say that retail investors (65 percent) and institutional investors (53 percent) are currently expressing interest in fossil fuel-free portfolios in the face of growing signs of climate change, according to First Affirmative Financial Network’s Fossil Fuels Divestment Survey.
Released in anticipation of the 24th annual SRI Conference (http://www.SRIconference.com) October 28-30, 2013 at The Broadmoor in Colorado Springs, Colorado, the online survey was conducted by First Affirmative Financial Network between April 22 and May 8, 2013. More than 2,000 SRI industry professionals were asked to weigh-in on 12 questions regarding fossil fuel-free portfolios and related investor concerns. The survey was completed by 466 licensed investment professionals, asset managers, investors, and representatives of SRI investment companies, community development financial institutions, and social research/proxy voting organizations.
Other key survey findings include:
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77 percent see growing risks for investors associated with fossil fuel company holdings in their investment portfolios.
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30 percent of those surveyed either already do – or are getting ready to – offer fossil-fuel free portfolios to investors.
As Steve highlighted, it’s fossil fuels that are the number one producer of carbon in the atmosphere, which is in turn the top human cause of global warming. Fossil fuel divestment is thus the prime issue facing investors concerned about the environment. So you ask, “How can I participate in divesting of fossil fuel companies?” My answer: Talk to your employer about the company retirement plan.
Many mutual funds own companies active in extraction, production, transportation and use of fossil fuel. These companies have business models that rely on extracting all the fossil fuel they can, by any means necessary, and burning it. If they do what is right for the world and slow—and eventually stop—the burning of their reserves, the way things are now means they will suffer huge balance sheet losses. Two factors are going to push them toward burning less fossil fuel, and therefore losing value to shareholders: First, governments will place more and more regulations on them and second, investors and consumers will steer away from fossil fuels because of increasing awareness, and the profits that can be made will decrease.
At the end of the day, I don’t need to make anything more than a financial argument here. Awareness of global warming is not going away, and alternatives to fossil fuels are only becoming more developed and prominent. These companies’ oil and coal holdings are no longer the safe long term investments they were in the 20th century. If just 10% of your retirement plan money is investing in these companies you could be in for more than bad weather. When you look for 6% annual returns and see a drop in value from 10% of a portfolio’s holdings, you’ll find yourself setback. To avoid this, speak to your employer or retirement plan provider about divestment from fossil fuels.
Your employer may or may not consider fossil fuel stocks as volatile as you do. They might even completely disagree with the science of climate change. Either way, if they are not be willing to move the company plan from Fidelity to Social(k). Instead ask your employer to consider adding one or two of the funds available today that are fossil fuel free, such as Portfolio 21, Green Century Balanced, Shelton Green Alpha, Pax World Global Enviromental Markets, and CRA Qualified Investment Fund.
These funds are leading the way with fossil fuel free portfolios. Nervous your portfolio will under-perform by not owning energy producers? This webinar slide-deck walks through how portfolios can avoid Carbon Risk and not sacrifice returns. Empower yourself and become active in divesting of fossil fuel stocks in your company 401(k), 403(b) or 457 plan. It’s no longer only the big guns who can vote with their dollars. Here is a guide to bringing fossil free portfolios to your employer’s attention.
Rob Thomas
About Rob Thomas: Rob saw a need for more than one or two Environmental, Social or Governance, ESG, screened funds in an organization’s retirement plan. In 2000 there were no viable options for smaller organizations to add a respectable set of screened funds to a plan. Rob created Social(k) as an option for responsible and sustainable organizations looking for a retirement plan that matched the organizations DNA. To date almost 300 companies have agreed with Rob and offer Social(k) at their place of work. Join MoveOn.org, Democracy Now, Honest Tea, 350.org, Social Venture Network, B lab, RSF Social Finance, Green America, Social Investment Forum and a few hundred others as Social(k) supporters.
A global coalition of over 200 institutional investors representing $2 trillion is asking industry leaders to quickly implement systemic reforms that will ensure worker safety, welfare, and adopt a zero tolerance policy on global supply chain abuses. At this point over 200 institutional investors have signed the accord. These investors represent sizable blocks of shares in many companies involved with oversees manufacturing of not only clothing but many other goods imported and sold to us, the consumer. We are concerned that a profit at any cost model is not only morally wrong but not financially prudent.
We join apparel industry leaders to use the tragedies in Bangladesh as a tipping point and hear our concerns about workers safety and welfare.
INDIGENOUS Fair Trade + Organic, a Social(k) client, and friend from way back, is offering to make their proprietary Fair Trade Tool available to ANY brand that publicly accepts the CHALLENGE that they will produce clothing in a way that is safe, ethical and honors people and planet.
ICCR: Transforming the Corporate World for the Common Good. Harnessing their power as shareholders in the world’s largest and most influential corporations, ICCR members work in coalition to promote corporate practices that ensure long term business growth while measurably improving environmental and social impacts.
In the Bangladesh clothing industry we have seen fires and building collapses kill 1500 and injure at least a 1000 more. The working conditions in third work factories across the world are deplorable as giant multinational corporations pursue constant increases in profits in a race to the bottom. We have heard that a garment made in Bangladesh costs about $6.50. We also read here that a living wage, safe work sites and fair labor practices would add 25 cents to that garment.
Over a dozen of these corporations say they are trying hard to monitor working conditions in some way but they are not able to do a better job, or they are not responsible for conduct of private companies in these countries at the end of the day. The result is 14 multinational corporations refusing to pay for a strict nationwide inspection program.
However 123 investors and stakeholders organizations, representing over $1.2 trillion in assets under management, issued a statement calling on industry leaders to implement systemic reforms that will ensure worker safety and welfare, and to adopt zero tolerance policies on global supply chain abuses.
INDIGENOUS Fair Trade + Organic, a Social(k) client, and friend from way back, is offering to make their proprietary Fair Trade Tool available to ANY brand that publicly accepts the CHALLENGE that they will produce clothing in a way that is safe, ethical and honors people and planet.
Scott and Matt understand the pressures these corporations are under, but you buy the products, or decide not to buy the products at the end of this chain. With that in mind they ask you, the consumer to join Indigenous, other brands, retailers and a growing number of consumers who are insisting on consciously produced fashion.
Take the PLEDGE: “I will find out where the garment I am about to purchase came from and who made it. I will not wear anything that people are suffering and dying to produce.” It’s that simple. When you take steps to learn about your clothes, and spend in a way that demonstrates your values you are changing the fashion industry.
This story brought to you by a Social(k) plan sponsor.
Gore Offers Sustainable Capitalism as Night-Vision Goggles for InvestorsBy Eric Roston May 20, 2013 7:42 AM EDT 1 Comments "
Bear with me,” Al Gore said to a rapt crowd of about 200 last Monday night at the fourth annual U.S.-India Energy Partnership Summit in Washington. He was asking the audience’s indulgence as he offered a scientific analogy to describe his investment philosophy.
Traditional investors focus on a narrow part of the spectrum of value that any company, or economy, produces, he said. Mainstream accounting in that way is like visible light. It’s all that eyes can see but makes up just 2 percent of the complete electromagnetic spectrum, the band of radiation that extends from high-powered gamma and x-rays to microwave and radio frequencies.Generation Investment Management, the firm Gore founded 10 years ago with former Goldman Sachs Asset Management Chief Executive Officer David Blood, tries to widen the bands of light that it sees by incorporating sustainability analysis. It’s an approach that values environmental, social and governance criteria “ESG” and long-term time horizons.
There’s a lot of information that’s material today — water, carbon, working conditions in far-flung suppliers — that hasn’t always been important to investors before.“If you take the rest of the sustainability factors into account, you can get a fuller and more realistic image, and that’s what we try to do,” he said.Generation Investment Management beta-tested its approach to what Gore and Blood call sustainable capitalism before the firm started investing client money.
It’s worked so far. “Knock on wood, we have done extremely well,” Gore said.Bloomberg News estimated Gore’s wealth last week at $200 million, in a 3,700-word investigation by Ken Wells and Ari Levy. Public filings show that in 2008 through 2011 London-based Generation racked up almost 140 million pounds $218 million in profits to be split among its 26 partners, Wells and Levy wrote. As founders, Gore and Blood are thought to have the largest equity stakes; the firm doesn’t disclose partnership equity or how the partners split profits, a spokesman told Bloomberg News.
Related: Call It What You Like — New Investing Approach Gains Followers: The GridGore Is Romney-Rich With $200 Million After Bush DefeatMajor U.S. Cities at Risk for Climate-Related Water ShortageResource Strain Pushes Coca-Cola, Dow to Put Price Tag on NatureGore cited Generation’s analysis of BP Plc as an example of their approach. “We were invested in British Petroleum, BP, when we started,” he said. The company’s CEO from 1995 to 2007, Lord John Browne, was an early climate hawk and made sustainability a rhetorical and marketing focus. After BP’s 2005 Texas refinery fire and its 2006 pipeline spill in Alaska’s Prudhoe Bay, Generation “looked at the safety culture and found that it had not been pushed into the American acquisitions. So we got out of BP — before the Deepwater Horizon,” he said.To refine Gores metaphor, sustainable investing is more akin to donning night-vision goggles, which extend human vision into the infrared band. That’s the part of the electromagnetic dial at which bodies radiate heat. It’s the same emission band as that other invisible thing Gore is known for trying to get people to see: atmospheric carbon dioxide.Analysis and commentary on The Grid are the views of the author and dont necessarily reflect the views of Bloomberg News.Visit www.bloomberg.com/sustainability for the latest from Bloomberg News about energy, natural resources and global business.
via Gore Offers Sustainable Capitalism as Night-Vision Goggles for Investors – Bloomberg.
SRI PROFESSIONALS SURVEY: MAJORITY OF RETAIL, INSTITUTIONAL INVESTORS INTERESTED IN “FOSSIL FUEL-FREE PORTFOLIOS”
63 Percent of SRI Professionals Expect Climate-Prompted Fossil Fuel Divestment in Next 10 Years
NEW YORK CITY AND COLORADO SPRINGS – May 16, 2013 – Over half of sustainable, responsible, impact (SRI) investment industry professionals say that retail investors (65 percent) and institutional investors (53 percent) are currently expressing interest in fossil fuel-free portfolios in the face of growing signs of climate change, according to First Affirmative Financial Network’s Fossil Fuels Divestment Survey.
Released in anticipation of the 24th annual SRI Conference (http://www.SRIconference.com) October 28-30, 2013 at The Broadmoor in Colorado Springs, Colorado, the online survey was conducted by First Affirmative Financial Network between April 22 and May 8, 2013. More than 2,000 SRI industry professionals were asked to weigh-in on 12 questions regarding fossil fuel-free portfolios and related investor concerns. The survey was completed by 466 licensed investment professionals, asset managers, investors, and representatives of SRI investment companies, community development financial institutions, and social research/proxy voting organizations.
Other key survey findings include:
· 77 percent see growing risks for investors associated with fossil fuel company holdings in their investment portfolios.
· 30 percent of those surveyed either already do – or are getting ready to – offer fossil-fuel free portfolios to investors.
· 63 percent believe that investors will in the next 10 years start divesting in meaningful numbers from fossil-fuel companies due to climate change implications of such energy sources.
First Affirmative President Steve Schueth, producer of The SRI Conference, said: “The survey findings strongly suggest that fossil fuel free investing is one of the SRI industry’s next big issues. Ours is an incredibly dynamic field, and as we develop the agenda for the 24th annual SRI Conference in October, we are working hard to present speakers and sessions focused on the most timely, important, and pressing topics. Fossil fuel free investing is already becoming a nationwide movement, and it’s likely to gain momentum as the impacts of climate destabilization are felt far and wide.
In addition, the survey also found that:
· 67 percent of respondents believe that 2013 is the right time for investors to assess and perhaps alter their approach to investing in traditional energy companies.
· 40 percent of those surveyed worry about increased diversification risk in fossil fuel free portfolios, in their role as a fiduciary to clients.
· 24 percent of those surveyed said they would be able to adequately replace the most carbon-intensive fossil fuel companies in portfolios they managed/advised with holdings that exhibit similar risk/return characteristics.
The full survey findings are available online at http://216.30.191.148/sricfossilfuelsurvey.pdf.
About The SRI Conference
The 24th annual SRI Conference (http://www.SRIconference.com), the leading North American forum for investors and investment professionals involved in sustainable, responsible, impact (SRI) investing, will be October 28-30, 2013 at The Broadmoor in Colorado Springs, Colorado. Please contact Krystala Kalil, at 888-774-2663 orkrystala@SRIconference.com.
About First Affirmative Financial Network
First Affirmative Financial Network, LLC () is an independent Registered Investment Advisor (SEC File #801-56587) offering investment consulting and asset management services through a nationwide network of investment professionals who specialize in serving socially conscious investors. First Affirmative produces The SRI Conference (http://www.SRIconference.com).
London-based HSBC is a banking and financial services company, very old and very large — the sixth largest public company in the world. Greenpeace it ain’t. So it’s striking that the latest report from the financial giant sounds strikingly like the hippie alarmism of a Bill McKibben, a Joe Romm, or a … me. Then again, our hippie alarmism sounds a lot like the science surveys put out by the International Energy Agency, the World Bank, MIT, and the U.S. National Climate Assessment.So I guess we’re all hippies now.The report is called “Peak Planet” you gotta pay for it, unfortunately — Giles Parkinson has a great write-up and it’s about the threat of climate change and “the next upswing in the climate agenda.”The broad story HSBC sketches is familiar. If we want to hold warming below 2 degrees Celsius over pre-industrial levels, there’s only so much carbon we can dump in the atmosphere. That’s our “carbon budget.” We can either budget for an 80 percent chance or a 50 percent chance of avoiding 2C obviously the budget is bigger if the chances of success are reduced. Like so:HSBCThe difference between the bars on the left and the bars on the right shows that, between 2000 and 2012, we used up about 420 gigatons of our budget. At the rate we’re going, says HSBC, we’ll burn through the 80 percent budget by 2026 and the 50 percent budget by 2039. To avoid that unpleasant outcome, global carbon emissions need to peak soon — by 2020 at the latest, says HSBC — and begin declining rapidly.Achieving that wildly ambitious aim would mean, as McKibben so well elucidated, leaving somewhere between 60 and 80 percent of current fossil fuel reserves in the ground. That’s about $27 trillion worth of value that must be set aside.That fact is so stark, so absurd, that it has taken some time to sink in. But it’s happening. Earlier this year, investors worth $87 trillion demanded that companies begin disclosing their “carbon risk.” As HSBC puts it, “The contradiction between global carbon budgets and fossil fuel reserves is gaining increasing attention.”
via Giant investment bank taken over by hippie alarmists | Grist.
10. United Technologies NYSE: UTX> Arm sales 2011: $11.6 billion> Total sales 2011: $58.2 billion> Total profit: $5.3 billion> Total employment: 199,900> Sector: Aircraft, electronics, engines United Technologies makes a wide range of arms — notably military helicopters, including the Black Hawk helicopter for the U.S. Army and Seahawk helicopter for the U.S. Navy. The company was the most profitable of all companies on this list, making more than $5.3 billion in 2011. It was also the largest company on this list by headcount, employing nearly 200,000 people worldwide as of 2011. Arms comprised just 20% of the company’s $58.2 billion in sales in 2011. Other products made by United Technologies include elevators, escalators, air-conditioners and refrigerators. International sales comprised 60% of the company’s total revenue in 2012.
via Ten Companies Profiting Most from War – 24/7 Wall St..
The faculty of the Rhode Island School of Design voted unanimously in favor of divesting from fossil fuels at a meeting Wednesday.
Though the faculty vote does not translate immediately to divestment, it could put pressure on the RISD Board of Trustees to work to divest from fossil fuels, said Anne Tate, chair of the faculty steering committee, which runs RISD faculty meetings.
Divestment has been a topic of campus debate since November, when the student group Divest RISD formed and began advocating administrative discussion about divesting from coal, said Emma Beede, a RISD student and founder of Divest RISD.
Beede worked with fellow members of the campaign to petition students and speak with the Board of Trustees, she said. The group’s efforts culminated in a presentation that Beede gave to the RISD faculty at a meeting last month.
An informal show of hands at the meeting revealed an almost unanimous opinion from the faculty in favor of divestment, she said. Over the next month, Divest RISD filed a motion to hold a formal faculty vote on the record.
“There was very little discussion,” Tate said, adding that Beede’s presentation in February presented a logical argument and a reasonable request of the institution.
Tate attributed the faculty’s unanimous opinion to an expression of unity and student support and faculty members’ beliefs that divestment is a wise choice in light of the threats presented by climate change.
“It’s a great opportunity for RISD to be a leader in this movement,” Tate said.
“(This vote) means that we’re seeing student activism for the first time,” Beede said, adding that RISD students have been restrained about activism in the past.
“Climate change is just the thing to bring us out of our bubbles,” she said.
Beede said the next step is to get a vote from the RISD student body. She added that Divest RISD has collected around 200 student signatures through its petition efforts.
“We’ve been focusing on the faculty mostly,” she said. “So far it’s been a low-key student campaign.”
Beede said Divest RISD’s partnership with the Brown Divest Coal campaign has been instrumental and will continue to be important in the months to come.
But Brown and RISD have “very different battles,” because RISD is a much smaller institution, Beede said, adding that Brown activists face many more obstacles in their campaign.
Nathan Bishop ’13, a member of the Brown Divest Coal campaign, said the group is thrilled about the RISD faculty vote, adding that it is “a wonderful step forward” for the community.
via RISD faculty votes supporting divestment — Brown Daily Herald.
Is It Really Possible to Have a Fossil Fuel Free Investment Portfolio?
Leslie Samuelrich – Senior Vice President, Green Century Capital Management and Will Lana, CFA – Senior Vice President, Trillium Asset Management February 4, 2013
The frequency and severity of extreme weather systems continues to impact the lives of people around the globe and increasingly in our own communities. Following Hurricane Sandy, many investors are becoming acutely aware of the presence of fossil fuel companies in their own portfolios. And growing numbers of people understand that climate change is no longer solely a threat to future generations – the damage to the environment, economy, homes, and lives is happening today.This past autumn, following an article that was published in Rolling Stone Magazine, author and 350.org founder Bill McKibben led a nationwide speaking tour encouraging thousands of investors to “Do the Math” on the carbon impact of their investments. As he repeated in cities from Seattle to Atlanta traveling mainly by biodiesel bus, of course!:
“It does not make sense to invest my retirement money in a company whose business plan means that there won’t be an earth to retire on.”
Similar to the South African divestment movement of the 1980s, students and alumni at colleges and universities nationwide are leading the charge and having some success in pressuring administrators to divest endowment funds from fossil fuel companies.
While traditional investment firms are just now grappling with this concept, Sustainable and Responsible Investing SRI pioneers like Trillium Asset Management Trillium and Green Century Capital Management Green Century have been on the forefront of clean energy and environmental investing for decades.Forgoing traditional energy companies in a portfolio can create short-term impacts on portfolio performance during certain time periods, particularly when energy companies are moving in different directions than the market as a whole. In Trillium’s core equity strategies, such as Large Cap Core and All Cap Core, Trillium seeks to invest in companies that are leaders within their industries in terms of minimizing the negative environmental impact of their activity. This also creates a platform for shareholder advocacy, which Trillium does with energy holdings in these core portfolios, as well as with its clients’ legacy holdings.That said, many SRI investors have found that not owning fossil fuel energy companies at all is an appropriate decision and can be incorporated into a portfolio with potentially minimal negative impact on performance over the long-term. Specifically, the Trillium-managed Green Century Balanced Fund Ticker: GCBLX has been fossil fuel-free since 2005 and in 2008 Trillium launched its Sustainable Opportunities product, which has been fossil-fuel free since inception.
via Is It Really Possible to Have a Fossil Fuel Free Investment Portfolio?.
 I found this great post yesterday on MarcGunther.com. It’s a must read!
As you’ve no doubt heard, Bill McKibben and his allies at 350.org have launched a a national campaign to persuade colleges, universities, churches, foundations and, yes, people like you and me, to stop investing in the fossil fuel industry. The campaign raises interesting questions as, I’m sure, McKibben hoped it would. Among them: Does divestment make sense as a strategy to curb climate change? If those of us who are concerned about climate change want to align out investments with our beliefs, what options are available? In a column called Deep Green Investing published last week by Ensia, a lively new online magazine about environmental solutions, I argued that, by itself, divestment will probably not accomplish much. Having said that, the campaign could prove useful as one of a number of tactics being deployed by 350.org, the Sierra Club and others that are aimed at bringing about political change–NAMEly, taxes or caps on global warming pollutants, EPA rules to curb coal-burning, etc. In The Nation, Mark Hertsgaard argues that these grass-roots climate efforts have already produced results–350.org galvanized opposition to the Keystone Pipeline, which may have persuaded President Obama to delay a decision after the election, and the Sierra Club’s Beyond Coal campaign has, along with cheap natural gas, helped drive the decline of coal in the US. Hertsgaard writes: As important as the victories themselves was how they were won. Both the Sierra Club and 350.org eschewed the inside-the-Beltway focus and top-down political strategy of big mainstream environmental groups, as exemplified by the cap-and-trade campaign. Instead, they emphasized grassroots organizing at the local level on behalf of far-reaching demands that ordinary people could grasp and support. Their immediate goal was to block a specific pipeline or power plant, but their strategic goal was to build a popular movement and accrue political power. This is the political context in which the divestment movement makes sense. It won’t shake up the oil industry–the Ensia story explains why–but it’s a useful organizing tool.
read more via Deep green investing: a closer look.
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