RIVERWATER IN THE NEWS

Sustainable agriculture is the next way ESG investors can fight climate change

Marketwatch. March 24, 2021. By Debbie Carlson

7 ways for ESG investors to profit from sustainable agriculture

The original green sector — agriculture — hasn’t been on the radar for environmental, social and governance investors, given industrial agriculture’s heavy dependence on pesticides, fertilizers and genetically modified seeds.

But ESG investors are turning their interest to agriculture as a way to fight climate change. In November, the US SIF, an organization that follows sustainable investing, said sustainable agriculture was an important investing issue for money managers, the first time this issue cracked the top five specific criteria. Of the $17 trillion (link) invested in ESG issues, money managers (link) said they devoted $2.38 trillion to sustainable agriculture while institutional investors (link) devoted $2.18 trillion to the theme.

It’s a harder investment for individual investors; there are no targeted mutual funds or exchange-traded funds for sustainable agriculture and just a handful of stocks to choose from.

Investing in sustainable agriculture is still in early stages, not unlike where the renewable energy sector was in 2007 as far as ESG investor interest, says Erin Fitzgerald, CEO of USFRA, a national network of farmer and rancher-led organizations that’s working to expand ESG investment in sustainable agricultural technologies. USFRA recently released a report (link) about how ESG investors can think about public or private investments in agriculture to mitigate climate change by improving soils.

That could mean a money-making opportunity for investors, especially if the valuation premiums usually given to ESG companies aren’t priced in. But given that it took renewable energy years to become profitable, there could be stumbles. Plus, some ag companies may be improving their environmental record but also have other aspects that ESG investors find distasteful, such as researching genetically modified organisms or poor worker policies.

Continue reading.

ESG: Growth Is Welcome, But What Drives Actual Change?

WealthManagement.com, March 11, 2021 By Cindy Bohlen

Encouraging news arrived late last year about the fast growth of investments managed with attention to environmental, social and governance (ESG) factors. Seventeen trillion was the headline dollar figure in the latest biannual report from trade association US SIF, which tracks the responsible investing industry.

Seventeen trillion represents a 42% increase over the dollar level US SIF found just two years ago. Today 33% of professionally managed dollars in the U.S. is invested with at least some consideration to ESG issues.

That headline growth is impressive and welcome, but I’m actually more struck by some of the undercurrents in the report, particularly with respect to what investors say is most important to them.

From Governance to Environment to Social…and now back to Governance

Of the three letters in “ESG,” it’s fair to say the “G” came first, in the sense of widespread awareness of the benefit of applying the concept as an investment factor. The level of a board’s independence—for example, by incorporating independent Chair and CEO roles—came up for widespread awareness in the 1980s, as did the level of executive pay.

Read more.

Malkiel’s Misguided View of ESG Investing

Advisor Perspectives, February 1, 2021

Burton Malkiel, esteemed author of the classic investing book A Random Walk Down Wall Street is one of the more prominent critics of environmental-, sustainable- and governance-based (ESG) investing. He called ESG investing a “self-defeating” strategy in a recent Wall Street Journal column.

But Malkiel and other detractors who claim ESG is a fad are missing a key element in their arguments, namely that companies are incorporating sustainability into their operations both in response to – and increasingly quite apart from – the ESG investing trend.

People invest in stocks because they want to make money. That’s a basic truth that ESG investing neither needs nor seeks to change. Rather, ESG investing asks, “If you can do good with your money while also achieving attractive returns, why wouldn’t you?”

Read more

Greg Wait featured in Your ESG investment may be a ‘light touch’ fund and not as green as you think

Marketwatch. January 4, 2021

Environmental, social and governance investing resonates with people who want their investments to align with their values, and the boom in this investing style has fund companies launching more ESG investment vehicles.

But these funds may not be as green as investors think they are.

ESG investing considers both financial return and social and environmental good. But just as investors can disagree on where to draw the line between value and growth investment styles, they can come to different conclusions about how well companies are delivering in these areas. There are no U.S. nor global standards.

Read more

Greg Wait featured in Here’s how you can add sustainable investments to your 401(k) holdings even if your plan doesn’t include ESG funds

Marketwatch. November 13, 2020

Even as the Trump administration actively discourages environmental, social and governance investing in employer-sponsored retirement plans — a rule the Biden administration may overturn — it’s not like investors had a lot of ESG choices to begin with.

When Morningstar looked at lineups for defined-contribution plans like 401(k)s or 403(b)s , the research firm found only 4.5% of these plans offered at least one sustainable fund — that is a fund that intentionally incorporates ESG.

But for those who want to invest that way, there are ways to do it within the company-sponsored retirement plan. It just takes some legwork to find them.

Read more

 

Riverwater Partners’ Statement on Racial Equity

June 11, 2020

Worldwide protests over the past weeks spurred by the killing of George Floyd have brought our society to what we can only hope is a tipping point. We recognize that the effects of racial inequalities are pervasive and profound. In addition to unjust and unnecessary violence, disproportionately devastating realities in the Black community in the wake of the COVID-19 pandemic have further highlighted the effects of systemic racism. 

Read more