Investing for Change: Beyond Renewables
More and more investors are choosing to integrate social and environmental factors into their stock selection process. Their reasons for doing so vary: Some see it as an ethical obligation, others as a risk mitigation strategy, still others as a value-creating proposition. The challenge is that many people don't know where to start.
John Vechey of PopCap Games recently joined The Motley Fool for a climate change summit. Among his guests were Stu Dalheim, vice president of shareholder advocacy at Calvert Investments, and Todd Larsen, director of corporate responsibility for Green America. In the following video, Stu and Todd discuss ways that private investors can begin to make their portfolios more sustainable.
Both speakers recommend a broad approach, rather than focusing too narrowly on individual factors and missing the forest for the trees. Stu mentions two areas where he sees opportunity for future growth: water and energy efficiency.
If we look at Calvert Investments' top holdings in its global water and energy funds as of the end of June, we see some interesting names worth consideration. This would have been a nice little basket to hold over the past decade. Note that this in no way "proves" that sustainability adds value. That is very difficult to quantify, and much work has been done in that area. These are just the numbers I got on the first set of tickers I chose with the first time horizon I selected -- 10 years.
Company | Market | Share Price 7/30/03 | Starting | Share Price 7/29/13 | % Change | Unadjusted % Change |
|---|---|---|---|---|---|---|
Eaton | $10.05 | $16.19 | $21.03 | $67.62 | 317.6 | 221.5 |
Flowserve | $0.9 | $5.93 | $6.39 | $56.36 | 850.4 | 782 |
Johnson Controls | $10.9 | $13.22 | $16.02 | $41.09 | 210.8 | 156.4 |
Companhia de Saneamento Basico | $1.04 | $0.95 | $1.55 | $10.39 | 993.6 | 570.3 |
Xylem | $3.87 | $23.57 | $24.25 | $28.46 | 20.7 | 17.3 |
Watch the following video to learn more about strategies you can use in your own investment approach.
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The article Investing for Change: Beyond Renewables originally appeared on Fool.com.
Sara Murphy has no position in any stocks mentioned. Follow her on Twitter: @SMurphSmiles. The Motley Fool recommends SABESP. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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