Sustainability Investing - What Does it Mean?

Robecosam ^ | March 3, 2017 | Vanity

[yetidog]

Should attention be paid to investment products sustainability ratings?

[yetidog]

I have come across an investment product evaluation called "sustainability rating" which intends to rate the product on the attention corporate management supposedly pays to supporting "environmental, social and governance factors" in making fundamental decisions affecting company growth and stability. I have no idea as to whether a low, moderate or high "sustainability rating" is an effective or even realistic guideline for making a personal investment decision. Has anyone run across this before? Where did it originate and how valid of an investment tool might it be?

[Laslo Fripp]

Skip

[Pearls Before Swine]

Should you pay attention?

If you like. It is virtue signalling for corporations.

It’s mostly public relations, but if you’re a greenie, you can use it to limit your selection of potential investments.

[G Larry]

Are you aware of ANY profitable recycle programs?
How about solar or wind power that covers the cost of the gov’t subsidies?

“sustainable” = perpetual motion

Unless you want to scavenge some tax advantage, its a loser.

[bus man]

When normal people use the word “sustainable,” they mean “something that is capable of being perpetuated or continued for an indefinite period.” When liberals use the word, they mean “something that agrees with my own biases.” I suspect that the investment criteria being discussed here is more of the latter type of sustainability.

Next time a greenie prattles on about sustainability, ask him if he supports nuclear power. I mean, it’s not like we’re ever going to run out of atoms; how much more sustainable can you get?

[wjcsux]

I would pass if I were you.

[maxsand]

where and whenever you hear the word “sustainable”...you best run for the tall grass...

[oh8eleven]

There is a wealth of information on this Morningstar sustainability page.
Note - to access most of it, you'll have to sign up to become a Morningstar member, but that's free.

[Lou L]

Should attention be paid to investment products sustainability ratings?

I think "sustainability" falls into the same category as "socially responsible" or "ethical" investing. There are a number of research reports that show the results for these types of funds performed no better or worse than those that did not meet the criteria for being "socially responsible."

Given that "sustainability" can mean different things to different people, I don't know if this measure can truly be stated accurately. At best, it's trendy. At worse, it's "fake data" about a company that doesn't give any indication as to how profitable or well-managed a company is.

Also, remember that past performance is no indication of future results.

[dfwgator]

where and whenever you hear the word “sustainable”...you best run for the tall grass...

And hide your wallet.

[jalisco555]

Reminds me of the Social Responsibility funds which won’t invest in defense contractors, tobacco stocks, fossil fuel companies etc. Good for virtue signalling, bad for your bottom line.

[WinMod70]

Marketing ploy akin to “Organic” in the grocery aisle. The terms mean what the seller defines them to be.

[Organic Panic]

Buy Solyndra stock. It has no where to go but up.