Responsible Investing: Is Your Portfolio Melting The Ice Caps
Dale Wannen, Kapitall: Responsible investing means many things, but I think we can agree investing in our planet makes sense. Even cents?
So climate change is happening. Scientists have told us that the earth has warmed 0.8 percent since the late 1800s. They have also reported that the concentration of carbon dioxide has gone from 280 parts per million in 1750 to over 400 parts in 2013. But what does this have to do with my 401k or investment portfolio you ask? Quite a lot, actually.
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When you click the BUY button in your brokerage account, you are becoming an owner in the stock of a company, just as if you were buying a pint of ice cream from the local Whole Foods (WFM) USSIF’s most recent paper, Investing to Curb Climate Change, outlines the various, fairly simple ways people can make positive changes to their portfolio when it comes to sustainable investing.
Direct ownership of stocks
Every investor decides whether or not a tobacco company or polluting oil company is in their list of stocks. If you agree with their business practices, you can easily sell or divest yourself of these firms. When you have some free time, consider reviewing a company's 10k Report (Section 1A discusses any risk factors the company feels it may be facing).
Or go to the company website and search for a sustainability report. If you don’t see one, well, don't panic. But consider whether such a report would be meaningful to you as an investor. If the company has a link to a corporate social responsibility (CSR) report, or a profile on CSRHub, see what kind of targets they have set for reducing CO2.
Be sure to vote your proxy. You voted in the last Presidential election, right? Perhaps even more important than this is to vote on any shareholder resolutions listed. Do you want to have a say as to whether or not Denny’s (DENN) should be using cage-free eggs? I do.
Don’t be bashful. If you have owned a stock for at least one year, you may be eligible to voice concern through a fairly simple 500-word statement to the CEO and Board of Directors. This proposal could be put on millions of proxy statements and even give you a five minute spot to speak directly to the CEO and executives of any company at their annual shareholder meeting.