Responsible Investing: Making an Impact Prudently
Investors have various motivations for incorporating responsible investing considerations into their portfolios. Some desire to first and foremost “do good” with their financial resources (commonly referred to as “impact first” investment). Some are committed to aligning their investments with their values and, at a minimum, not supporting what they consider to be harmful. From this orientation, the phrase “sin stocks” has emerged. Others have goals — environmental or social, for example — arising from reputational or political considerations. And some act on a belief that “responsible” companies will outperform over a long-time horizon.
Fiduciary investors face some unique considerations as they invest for others, subject to strict fiduciary duties with a high bar. With an exclusively-financial view of investment, the concern is the risk of under-performance. But that is not the end of the conversation. If “sin stocks” historically out-perform, is it only prudent for a fiduciary to have a sin-tilted investment portfolio? Do the interests of beneficiaries include non-financial elements? Speakers will consider current trends in responsible investing, continue with an analysis of issues particular to investors with fiduciary obligations, and conclude with a discussion of a responsible investment policy in the fiduciary context.
ACTEC 2014 Fall Meeting
October 16 – 19, 2014
New Orleans, LA