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Sustainable Investing

What is Sustainable Investing?

Sustainable investing is investing to make a difference. One of the primary reasons to consider sustainable investing is because it is a force for positive change – it’s changing the investing industry, improving companies, and helping our communities. Activating an investment portfolio across the impact opportunity set may help align a client’s portfolio with their primary motivations. Put simply, sustainable investing is a strategy that strives to align your investments with your personal values.

Furthermore, it's an investment approach that considers environmental, social and governance (ESG) factors in portfolio selection and management.

Environmental - Focus on companies’ ability to limit exposure to climate risks and other environmental risks and take advantage of opportunities presented by the transition to a low-carbon economy.

Social - Focus on companies’ ability to create value through a productive workforce, high quality products and positive community relations; to minimize costs of product recalls, related litigation and reputational risks.

Governance - Focus on companies’ ability to align interests of management, shareholders and other key stakeholders over the long term; incentivize sustainable value creation and ethical practices; reduce reputational damage.

Environmental Issues

  • Climate change and carbon emissions
  • Air and water pollution
  • Biodiversity
  • Deforestation
  • Energy efficiency
  • Waste management
  • Water scarcity

Social Issues

  • Customer satisfaction
  • Data protection and privacy
  • Gender and diversity
  • Employee engagement
  • Community relations
  • Human rights
  • Labor standards

Governance Issues

  • Board composition
  • Audit committee structure
  • Bribery and corruption
  • Executive compensation
  • Lobbying
  • Political contributions
  • Whistleblower schemes
How Is ESG Integrated Into The Investment Selection Process?

How Is ESG Integrated Into The Investment Selection Process?

Combining fundamental screening and ESG criteria helps identify high-quality companies.

• Provides a holistic view of a company’s
business practices.

• Helps identify opportunities that may not
be apparent from traditional financial
analysis alone.

• Seeks to hedge against volatility and
downside risk.

Why We Do This?

Why We Do This?

Manage Risk - ESG integration is associated with risk mitigation. Evaluating how companies are meeting ESG challenges and opportunities provides additional insight into culture, operational strength, risk management and quality of management.

Improve Returns - ESG factors are material to a company’s long-term financial prospects. ESG integration is associated with competitive or improved long-term performance.

Drive Impact - Investing in ESG leaders and engaging with companies, regulators and public policymakers can improve corporate behavior.

Growth of Sustainable Investing

Growth of Sustainable Investing

Did you know?

1 in 4 dollars under professional management in the US is invested according to a sustainable investing mandate.

Total U.S.-domiciled assets under management using sustainable investing strategies expanded from $8.7 trillion at the start of 2016 to $12.0 trillion at the start of 2018 — a 38% increase.

Assets dedicated to sustainable investing mandates have grown significantly since 2012.


How About Performance?

How About Performance?

We believe the integration of ESG factors into an investment discipline can be additive to portfolio returns.

MSCI KLD 400 Social Index provides broad exposure to socially responsible U.S. companies.

The S&P 500, or simply the S&P, is a stock market index that measures the stock performance of 500 large companies listed on stock exchanges in the United States. 

All indexes are unmanaged and cannot be invested into directly.

Past performance is no guarantee of future results.

What Sustainable Investing Options Are Available To You?

Optify Financial has developed it's own suite of sustainable portfolios that we curate and monitor often. Additionally, thru our partnership with LPL Financial, we also offer access to a variety of sustainable investing choices, ranging from exchange-traded funds (ETF), mutual funds, separate account managers, and centrally managed turnkey portfolios. LPL Research provides due diligence and recommendations for third-party investment managers that are also sustainable investing leaders.

Sustainable Investing: In Summary

Sustainable investing seeks to better manage risk and deliver a fair return to investors while also having a positive social and environmental impact.

In our view, it is simply a better, smarter way to invest.