Our friends at EQ Investors have just released EQ’s annual impact report. The report, titled ‘Investing for people and the planet’, presents the social, environmental and financial results generated by EQ’s Positive Impact Portfolios. Read on for key highlights from the report – hard evidence of how they’re helping investors to ‘do good’ with their money.
Key findings from the research show:
» An increase in the impact made per £1m invested:
- Transition to renewables – generated 189 MWh of renewable energy, equivalent to the electricity used by 57 households;
- Carbon footprint reduction – avoided 228 tonnes of C02 emissions, equivalent to taking 50 cars off the road;
- Reached 50 people with preventative healthcare and delivered 380 hours of school, higher and adult education.
» More inclusive than traditional investments – EQ’s Positive Impact Portfolio attract a higher proportion of women investors (54%) than the UK average (43%) and are also more attractive to younger investors.
» Further evidence that you can invest sustainably without sacrificing return – the portfolios have beaten their benchmarks over the past 7 years, adding to the mounting evidence that not only is there no trade-off, but that sustainable investing reduces downside risk.
» Faster growing than MSCI & FTSE companies – whether you look at revenues, profit growth or R&D spend, companies within the EQ Positive Impact Portfolios compare favourably with the broader market.
Damien Lardoux, Head of Impact Investing at EQ Investors, commented on the findings:
“Not only have the EQ Positive Impact Portfolios achieved more impact than ever before, but we present further evidence that you can invest sustainably without sacrificing returns. The positive impact approach not only reduces downside risk, but captures additional upsides from competitive advantages, megatrends and legislative support.”
Designed to address social and environmental issues
EQ’s Positive Impact Portfolios invest in firms which solve social and environmental problems. Underlying investments are mapped against the UN Development Goals, focusing on the core products and services that each company provides. Below you can see how the portfolios compare to major world markets:
“Most mainstream funds that invest in UK shares, including the default funds in most workplace schemes, will hold some of these categorised as ‘causing harm’. When considering your investments and pensions, use the sniff test: look at the top 10 holdings and decide whether those companies are what you are happy to invest in.”
How EQ’s approach is driving change
EQ’s takes a whole ecosystem approach to investing. Climate change provides a good example:
1) Avoiding harm: excluding fossil fuel extractors who are major contributors to the climate crisis;
2) Benefiting stakeholders: investing in companies with lower operational carbon footprints;
3) Contributing to solutions: investing in companies that mitigate climate change.
To download a copy of the report, please visit the EQ website.