Sustainability yearbook highlights responsible investment opportunities

RobecoSAM, an investment specialist with a focus on sustainability, has published its 2014 sustainability yearbook, signalling which companies are in a position to create long-term shareholder value whilst still being ethical. 

The yearbook looks at the 2013 sustainability performance of various companies, and ranks them with gold, silver and bronze ratings – the top performing firm in each sector being named an industry leader. More than 800 companies from 59 industries and 39 countries participated in the assessment.

As the yearbook ranks companies from a wide variety of sectors, it includes industries that some investors may consider unethical, such as tobacco; casinos and gaming; coal and consumable fuel; and oil and gas.

All companies are ranked on criteria across three categories: economic, environmental and social. For example, in the oil and gas industry, this includes risk and crisis management, climate strategy and social impact on communities.

Some 52 companies located in the UK made it into the yearbook, with four – Anglo American, BG Group, British American Tobacco and J Sainsbury – being awarded the gold standard.

The best performing sector was found to be household products with an average sustainability score of 66%. The industry leader, Germany-based Henkel AG & Co, scored 82%. UK firm Reckitt Benckiser was given a silver award in the category.

Across all sectors, the top performing company was telecommunications firm KT Corp, based in South Korea. The company scored 94% against an average of 59% for its industry.

Michael Baldinger, CEO of RobecoSAM, noted that while sustainability reporting was now considered partially mandatory for most multinational companies, many still struggle to communicate how environmental and social governance factors affect the long-term financial performance of their business. He called on firms to encourage responsible investment by leading by example.

He said, “Companies still face many challenges in convincing investors to embrace sustainability as a means of generating shareholder value. I am confident we can change this. Starting with their own corporate pension funds, sustainability leaders are in an ideal position to encourage investors to integrate sustainability into their investment strategies.”

Further reading:

Demand for sustainable, responsible and ethical financial advice rises to 76%

Public sector workers let down by ‘dodgy pension investments’, say campaigners

Sustainable investment is about optimisation, not maximisation

Falling cost of solar to blame for European renewables investment drop

Climate change a long-term threat to investment, UN tells investors