Managing Sustainable Impacts: An Investor Sustainable Impacts: An Investor Perspective Reed Montague Sustainability Analyst Sustainable and Responsible Investing Calvert Investments

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  • Inova Intersections Sustainability SymposiumBrainPower Presentation Series

    Managing Managing Sustainable Impacts: An Investor PerspectivePerspectiveReed MontagueSustainability Analyst

  • Sustainable and Responsible Investing

    Calvert Investments has been providing sustainable andCalvertInvestmentshasbeenprovidingsustainableandresponsibleinvestmentsthroughavarietyofinvestmentstrategies.Asoflastyear,allourfundsarenowtobaccofree,althoughmanyhavebeensince1982.

    Sustainableandresponsibleinvestingincludesissuessuchastheenvironment,productsafety,workplacelabor,humanrights,governanceandcommunity.

    IntersectionsSustainabilitySymposium2013

  • Financial and ESG Impacts

    As active investors with over $12 4 billion inAsactiveinvestorswithover$12.4billioninassetsundermanagement,welookatbothfinancial and the environmental social andfinancialandtheenvironmental,socialandgovernance(ESG)aspectsofacompanywhenmaking an investment including how it handlesmakinganinvestment,includinghowithandlesrisks.

    IntersectionsSustainabilitySymposium2013

  • Why Does Risk Matter?

    When a company effectively manages its risksWhenacompanyeffectivelymanagesitsrisksthroughsoundpolicies,programsandperformance it is better able to handle andperformance,itisbetterabletohandleandaddressanyproblemsorissuesthatmayarise.

    Itisimportanttodisclosesuchinitiativesfori d k h ld h h hinvestorsandstakeholdersthroughvenuessuchasasustainabilityreport.

    IntersectionsSustainabilitySymposium2013

  • Highest Risks for Hospitals

    Forthehospitalindustry,wetypicallyseetheyp yhighestrisksas: PatientCareandSafety WorkplaceLaborandSafetyp y Environment

    Reviewing their Reviewingtheirsustainabilityallowshospitalstomanageareasof strength and weaknessofstrengthandweaknessandoffersaneducationalandinformativeprocess.

    IntersectionsSustainabilitySymposium2013

  • Patient Safety Considerations

    Inengagingwithhospitalchains,weaskaboutthestepspthehospitalistakingtoprotectpatients.

    Arestafftrainedregularly onregularlyonpatientsafety?

    Howisthequalityofcare?

    Howarepatientshandledintimesofnaturaldisaster?

    Isthereapatientbillofrights?

    IntersectionsSustainabilitySymposium2013

  • Worker Safety Considerations

    Worker SafetyWorkerSafety Howisthehospitalprotectingworkersfromoverworkandburnout?

    Canworkersspeakuptomakeimprovements? Howaresuggestionshandledandimplemented? Howareworkersprotectedfromaggressivepatients?

    k f d f Workersafetyandsatisfactioncanimpactpatientcare.

    IntersectionsSustainabilitySymposium2013

  • Environmental Considerations

    Environmentalissuesi l dcaninclude:

    Water(RiskM S lManagement,SupplyChain,andWaterasaHuman Right)HumanRight)

    EnergyUseWaste Disposal WasteDisposal

    ClimateChangeAdaptation/MitigationAdaptation/Mitigation

    IntersectionsSustainabilitySymposium2013

  • Waste Considerations

    Hospitals have the second largest wasteHospitalshavethesecondlargestwastestreams,afterthefoodindustry. What is being done to reduce and eliminate Whatisbeingdonetoreduceandeliminatewaste?

    Recycling?Recycling? MedicalWaste? DisposableWaste? Isthereawaytoreduceconsumptionoronetimeusageversusmultipleuseequipmentinemergencyrooms?rooms?

    IntersectionsSustainabilitySymposium2013

  • Hazardous Waste Considerations

    Is hazardous waste beingIshazardouswastebeingproperlyhandledanddisposedof?

    Manyhospitalsarenotmanagingthispartoftheirwasteeffectivelyandthuscanbeatriskf fi f dforfinesfromstateandfederalgovernments.

    IntersectionsSustainabilitySymposium2013

  • Energy Considerations

    EnergyUsee gy Use Aretheresustainableenergysystemsthatincreaseffi i ?efficiency?

    Howcanthehospitalscarbonfootprintbereduced?p

    Throughtravel,energyuse,commuting?

    Are renewable energy Arerenewableenergyresourcesbeingused?

    Whataboutwind,solar,biofuels?

    IntersectionsSustainabilitySymposium2013

  • Building Health Considerations

    Building Health:BuildingHealth: Whataboutchemicalmanagementandlimitingexposure?p

    Aretheregreencleaningoptions? Arethereairfiltersorpurifiers?Shouldtherebetohelpthosewithcompromisedimmunesystems?

    Aretherechemicalsthatoffgasthatcanbereduced? Isgreendesignandconstructionconsideredbeforeanewaddition?

    IntersectionsSustainabilitySymposium2013

  • Greening the Supply Chain

    Hospitalscaninfluencetheirsupplychains

    Sometimesjustbyaskingforgreeneroptions. Placeemphasisonpurchasing

    toreduceexposuretoharmfulchemicalsA k f i bl Askforsustainablesubstitutes

    AskifpackageusebereducedAsk how recycling and/or re Askhowrecyclingand/orreusecanbeincreased

    IntersectionsSustainabilitySymposium2013

  • Resources

    Creating sustainability programs and reportsCreatingsustainabilityprogramsandreportsallowcompaniestheopportunitytoassesswhere they are and where they want to bewheretheyare,andwheretheywanttobe.

    HelpfulResources:H lth H it l I iti ti b P ti HealthyHospitalInitiativesbyPracticeGreenhealth

    Global Reporting Initiative (GRI) GlobalReportingInitiative(GRI) ACCA/CERESawardsforSustainabilityReports

    IntersectionsSustainabilitySymposium2013

  • Company Engagement

    In order to encourage change we regularlyInordertoencouragechange,weregularlyengagewithcompanieswithwhomweinvest.

    If they are interested in what we have to say Iftheyareinterestedinwhatwehavetosaygreat!

    If d fili h h ld Ifnot,wemayendupfilingashareholderresolution.

    IntersectionsSustainabilitySymposium2013

  • What is a Shareholder Resolution?

    A shareholder resolution is a tool used byAshareholderresolutionisatoolusedbyinvestorstoencouragemanagementtolistento their concernstotheirconcerns.

    Oncearesolutionisfiled,thecompanymustinclude the proposal at its own expense in theincludetheproposalatitsownexpenseintheproxystatementthatissenttoallinvestors.

    I i h d h l Itisthenvotedonatthecompanysannualmeetingbyallshareholders.

    IntersectionsSustainabilitySymposium2013

  • How Does the Process Work?

    If the company is responsive and interested,Ifthecompanyisresponsiveandinterested,wewilltypicallywithdrawtheresolutioninreturnforaparticularcommitment.

    Ifnot,theproposalwillgotoavoteattheannualmeeting,andsignificantvotepercentagesbyshareholderstomanagementdemonstrateconcernovertheissue,sendingh h h h ld bthemessagethatchangeshouldbeconsidered.

    IntersectionsSustainabilitySymposium2013

  • Hospital Engagement

    We engaged with two midsize hospital chainsWeengagedwithtwomid sizehospitalchainsofsimilarsizeslastyearbyfilingshareholderresolutions asking each to create and discloseresolutionsaskingeachtocreateanddiscloseasustainabilityreport.

    But we got very different responses Butwegotverydifferentresponses..

    IntersectionsSustainabilitySymposium2013

  • Engagement A Happy Ending

    HospitalChainAhadalreadybeentakingp y gsignificantstepstoaddressitssustainability.Theyhadalreadymademajorprogressonmanyof the areas we touched on aboveoftheareaswetouchedonabove.

    Theyrecognizedthatinvestorsandotherstakeholderswouldbeinterestedinlearningmoreabouttheadvancesandleadershiptheyaremakingandthatthiswasanopportunitytoshowcase their leadershipshowcasetheirleadership.

    Theychosetoproduceasustainabilityreport,scheduledforreleaselaterthisyear.

    IntersectionsSustainabilitySymposium2013

  • Engagement -- An Unhappy Ending

    HospitalChainB Madefeweradvancesontheirosp ta C a ade e e ad a ces o t eownsustainability.ItsBoarddeterminedthatitdidnotwanttodedicatestafftimeorresources

    d d ltoproduceareportorincreasedisclosure. Itchosetofighttheresolutionandneededto

    l i t h h ld h th h ld texplaintoshareholderswhytheyshouldvoteagainsttheresolutionintheproxy.

    The resolution was presented at the annual Theresolutionwaspresentedattheannualmeeting,whereitwenttoashareholdervote.Itearneda31%voteinfavoroftheresolution.

    IntersectionsSustainabilitySymposium2013

  • The End Result

    The hospital chain producing the report isThehospitalchainproducingthereportislikelytocreatethemostcomprehensivereportintheindustryuponitsrelease,settinganewstandardandbenchmarkforothers.

    Itdisclosesthepoliciesandprogramsinplaceandwillbepreparedtoaddresscomplicationswhentheyarise,forestallingreputationalrisk.

    Meanwhile,theotherhospitallostanopportunitytoexcel.

    IntersectionsSustainabilitySymposium2013

  • C t t Contact Information Information

    Reed Montague gSustainability AnalystCalvert InvestmentsReed.montague@calvert.comReed.montague@calvert.comwww.calvert.com

    BrainPower presentations may be downloaded at BrainPower presentations may be downloaded at www.inova.org/intersections after the event.