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THE FUTURE IS SUSTAINABLE INVESTINGLeveraging Impact Investing, SRI, and ESG
to Forge Enduring Client Relationships
Inside Fixed Income September 13, 2019
Facilitating successful rollout and adoption of Impact Investing & ESG Solutions for financial services firms.
SpeakerDynamic & engaging keynote speaker at top industry events.
AuthorAuthor of Connected Investing, a popular newsletter about all things ESG, SRI, and Impact Investing.
ConsultantSubject matter expertise & advisory service to drive successful rollout and adoption of ESG and Impact Investing solutions. Clients include: Custodians, Mutual Funds, RIAs, Broker Dealers.
@SonyaDreizler
@SolutionsWithSonya
Sonya Dreizler
Au
die
nce
Po
ll
1. My practice is focused primarily on this type of investing.
2. I serve a handful of clients in this area but it’s not my primary business.
3. I don’t have any direct experience with it. I’m here today to learn.
4. I’m just here for the CE credit.
What is your level of Impact Investing, SRI, or ESG knowledge or use in your business?
History
ANTI SLAVERY WORKER
PROTECTIONS
SIN STOCKS
Sustainable investing drivessocial and environmental progressthrough investments, while screening for risk, creating competitive returns, & inspiring resilient investor behavior.
SustainableInvesting
Terminologymost common terms
ESG = Data
SRI = Values
Impact = Intention
Sustainable = Mixed Bag
Terminologyless common terms
Green = Mixed bag, environmental tilt.
Mission Driven = Mixed bag, often foundation (or sometimes religious) tilt.
Community Investing = Location or community specific, usually via lending.
Place Based= Location, usually via lending. “Opportunity Zones” is an emerging area.
Terminologyneed to hear that again? WATCH READ
The Impact Toolbox
Investing Divesting
LendingEngagement (AKA advocacy or activism) & proxy voting.
Fixed Income Vehicles & Products
DIVIDEND PAYING EQUITIES/
PREFERREDS
GREEN BONDS & CORPORATES
MUNIS NOTES
A WORD ON TREASURIES
MUTUAL FUNDS AND ETFS
SMAS
CustomizationIs Coming
Environment- general and specific
Gender equity
Racial justice
Small business
Place based/ Community investing
Inclusive Workplace
Why Add ESG or Impact Investing to Your Practice?
Demand
Fiduciary responsibility
Enduring client relationships
Practice differentiator
Why Add ESG or Impact Investing to Your Practice?
Demand
Fiduciary Responsibility
Enduring client relationships
Practice differentiator
Demandfor SRI, ESG & Impact Investing
18%
82%
Financial Advisors Talking to Clients about SRI Options
Having the conversation
Nope!
75%
25%
Investor Interest in Sustainable Investing
Interested
Not Interested
Source: Nuveen StudySource: Morgan Stanley Study
Why Add ESG or Impact Investing to Your Practice?
Demand
Fiduciary Responsibility
Enduring client relationships
Practice differentiator
There is no perfect portfolio.
Let’s try this out!
In addition to the physical & financial well-being of you and your loved ones, what values are important to you?
1. Take a note card, write down a value that is important to you. (Need a hint- where do you donate your time or money?)
2. Note why it’s important to you.
3. Meet a neighbor, preferably someone you don’t know well already.
4. Person with the most letters in their first name is the “advisor” first. Ask the question above.
5. Switch roles after 3 minutes. (I’ll tell you when to switch.)
Let’s try this out!
How did that go?
Any interesting observations?
How did you feel when you were the client?
Let’s Talkhaving the values conversation with clients
SPECIFIC THEMES VS BROADLY
“DOING BETTER”
SETTING EXPECTATIONS ABOUT WHAT IS
POSSIBLE
CHARITABLE GIVING
VOLUNTEER ACTIVITIES
USE THIS INFO TO CONNECT
THROUGHOUT THE YEAR
THIS IS NOT A ONE-TIME
CONVERSATION
Building Into an Existing Practice
Assess Interest
Get Ready
Implement
Marketing
Best Practices
Use STORIES to connect and have data to follow up.
Address
PERFORMANCE. ESG screens can reduce risk and find smart companies.
Don’t OVERHAUL the way you work.
Don’t lead with the
performance MYTH. Leading with it gives credibility to the myth.
Don’t use industry
JARGON.
US SIF’s Education Center
The GIIN’s Knowledge Center
The Impact Resource Library
Principals for Responsible Investment
Cen
tral
ized
Info Bloomberg Sustainable Finance Briefs
ImpactAlpha’s Daily Brief
Green Money Journal
Connected Investing
New
s D
ige
sts
Imp
act
Inve
stin
g G
uid
es
GIIN: What you need to know about impact investing
Sonya Dreizler for CNBC: From SRI to ESG, values-aligned investing has many names.
CFA: ESG / Sustainable Investing overview, papers, and guides
World Economic Forum: The Future of Sustainable & Impact Investing Project
Case Foundation: Short Guide to Impact Investing (from 2015 but still good info)
ImpactAssets: Issue Briefs
Dat
a &
Mea
sure
men
t To
ols
Yahoo Finance Sustainability Data (free)
FI 360 (subscription fee)
HIP Investor Impact Ratings (Subscription Fee)
Social Fund (free)
Fossil Free Funds (free)
Deforestation Free Funds (free)
Morningstar Globes (free)
The GIIN’s ImpactBase (free)
GIIRS Ratings / B Analytics (subscription fee)
Impact Reporting and Investment Standards (free)
SASB Navigator (subscription fee)
TruValue Labs / Insight360 (subscription fee)
IW Financial (subscription fee)
Sustainalytics (subscription fee)
MSCI ESG Integration (subscription fee)
Bloomberg (subscription fee)
Weapons Free Funds (free)
Whitepaper by Sonya Learn how to cross the four hurdles RIAs and financial advisors encounter when moving from interest to adoption of Impact Investing.
Specific to Inside Fixed Income 2019
Gurtin: Climate Change as ESG Risk in Munis
NYT: Climate Change & the Fed
Stay in the know.
Text SOLUTIONS to 33777 to subscribe.
The latest developments in Impact & ESG.
Terminology decoded.
Industry leader interviews.
Business tips & more.
Sonya Dreizler, CFP®
Sonya Dreizler
@SonyaDreizler
@SolutionsWithSonya
Thank you!
Subscribe to Connected Investing
Text SOLUTIONS to 33777
