As someone who assists companies in understanding what sustainability is, how to advance towards strategically positioning themselves with a sustainable business model and how/what their investors will be looking for, I was thrilled last week when I discovered an index that I think may be in interesting vehicle for investing. More so, if you’re a global corporation… wouldn’t you like to be on this list?
The list is the NASDAQ OMX CRD Global Sustainability 50 Index. The index is an equally weighted equity index that serves as a benchmark for stocks of companies that are taking a leadership role in sustainability performance reporting and traded on a major US stock exchange. Even more interesting is that the index is “made up of companies that have taken a leadership role in disclosing their carbon footprint, energy usage, water consumption, hazardous and non-harzardous waste, employee safety, workforce diversity, management composition and community investing. These are companies that are voluntarily disclosing their current environmental, social and governance risks as well as their revenue opportunities and how it will affect future performance.” Also noted is that the security must also meet other eligibility criteria which include minimum requirements for market value, average daily share volume and price…. all things that an investor would also want.
So why is all of this impressive? Well it’s exactly what the whole sustainable investing movement is about. The belief that by buying good companies that understand that there is a strategic shift in the business model, therefore making marked moves toward limiting their risks and creating new opportunities, over the long-term an investor should get better investment returns. At the end of the day, isn’t that what we’re looking for in our investments?
For we Canadians, of particular note is that as part of this the semi-annual re-ranking which took place on May 24, Bank of Montreal (BMO) was added to the list and both Barrick Gold Corporation (ABX) and Royal Bank of Canada (RY) were removed from the list. For more information please check out: