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Strategic Analysis of Green Investing Opportunities

Explore the impact of green investing through active shareholder engagement and advocacy, with insights on strategies, trends, and tools for making a difference in corporate practices. Discover how ESG factors drive sustainable investments.

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Strategic Analysis of Green Investing Opportunities

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  1. Green Investing: CFA Society of Seattle May 24, 2010 Erin Gray, Strategic Analysis Green Century Funds Opportunities to effect change through active shareholder engagement

  2. Shareholder Advocacy or Engagement • Shareholder advocacy basics • Why investors engage with companies • Strategy overview and current trends • Engagement examples

  3. Advocacy Definition and Issues • Definition: • Using power of stock ownership to promote change in corporate practices • Issues (ESG): • Environment • Toxics chemicals, BPA, pesticide use, water • Social • Diversity, labor safety, animals rights, community relations • Corporate Governance • Say on Pay/Exec. Comp., political accountability, sustainability reporting, housing foreclosures

  4. Rationale for Engagement • Make a change vs. divestment • Increasing fiduciary pressure • Freshfields report • “…integrating ESG considerations… is arguably required” • “…a responsible investment option should be the default position.” • UN PRI (Principles for Responsible Investment) • INCR (Investor Network on Climate Risk)

  5. Green Century • Mission alignment • Risk mitigation • Competitive advantages of green investing • Risk assessment: • Litigation • Regulatory • Physical • Reputational

  6. Advocacy Tools • Direct negotiations • Shareholder resolutions • Voting proxies

  7. Shareholder Advocacy Trends • Social Investment Forum 2010 Trends Report: • > $3 trillion in assets use at least 1 of 3 responsible investment strategies

  8. Shareholder Advocacy Trends cont’d. Social and Environmental Shareholder Proposals Filed in 2011 Other – 2% Banking – 2% Animals – 4% Environment – 26% Health – 5% Sustainability Reporting – 10% Labor/ Human Rights – 13% Diversity – 13% Political Spending – 23% Source: As You Sow’s 2011 Proxy Preview

  9. Shareholder Advocacy Trends cont’d. 2011 Shareholder Resolutions by Filer 8% 8% 24% 13% 19% 13% 15% Source: As You Sow’s 2011 Proxy Preview

  10. Thank You! Contact Information: Erin Gray, Strategic Analysis Green Century Funds 206-315-2998 egray@greencentury.com www.GreenCentury.com

  11. Hydraulic Fracturing Source: ProPublica

  12. GC Balanced Fund Performance As of 3/31/11: The performance data quoted represents past performance, and past performance is not a guarantee of future results. Investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance information quoted. To obtain performance information current to the most recent month-end, please call 1-800-93-GREEN. Performance is calculated after fees and includes the reinvestment of Income dividends and capital gain distributions, if any. The performance shown does not reflect the deduction of taxes that a shareholder might pay on any Fund distributions or the redemption of Fund shares. The Balanced Fund uses the Lipper Balanced Fund Index as a benchmark. The Lipper Balanced Fund Index tracks funds whose primary objective is to conserve principal by maintaining, at all times, a balanced portfolio of both stocks and bonds. Typically, the stock/bond ratio ranges around 60%/40%.

  13. GC Equity Fund Performance As of 3/31/11: The performance data quoted represents past performance, and past performance is not a guarantee of future results. Investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance information quoted. To obtain performance information current to the most recent month-end, please call 1-800-93-GREEN. Performance is calculated after fees and includes the reinvestment of Income dividends and capital gain distributions, if any. The performance shown does not reflect the deduction of taxes that a shareholder might pay on any Fund distributions or the redemption of Fund shares. The S&P 500® Index is an unmanaged index of 500 selected common stocks, most of which are listed on the New York Stock Exchange. The S&P 500® Index is heavily weighted toward stocks with large market capitalization and represents approximately two-thirds of the total market value of all domestic stocks. It is not possible to invest directly in the S&P 500® Index.

  14. MSCI KLD 400 Social Index Performance

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