Values-Aligned Investing
Once a niche corner of the investing landscape, the idea of aligning personal values with investment portfolios has gone mainstream. Values-Aligned Investing describes the wide range of investment strategies and services we offer that seek to help investors align personal values with investment portfolios. Values-Aligned Investing can encompass a broad range of personal beliefs, ranging from social and environmental to faith-based values.
Examples of Values-Aligned Investment Opportunities
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| Renewable energy, waste management, water use, and climate change |
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| Human capital, community relations, labor standards, and diversity and inclusion |
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| Accounting, board structure, executive compensation, business ethics, and fraud |
Aligning investments with values
Values-aligned investing seeks to go beyond financial returns to further a societal or values-based goal, such as divestment from a particular company, sector, or industry. There is no one definition of value alignment, as investors care about different issues. While considering which issues may impact their investment decisions, investors may highlight environmental issues (like reducing pollution and protecting the environment), social issues (such as policies relating to healthcare or social justice), or governance issues (including business practices and financial transparency).Environmental, Social, and Governance (ESG) integration
Wells Fargo Investment Institute employs ESG-related insights in investment solutions. At Sabin Wealth Management Group, we work with Wells Fargo Investment Insitute and help interested investors understand, analyze, and incorporate ESG factors in an effort to pursue their own goals and those for the world at large.ESG investing may not be appropriate for all investors and is not an essential part of portfolio management with the Sabin Wealth Management Group. Consult our team for more information and to determine if you think ESG investing is right for you.
ESG Investing: As Seen in "The Wall Street Journal"
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Bruce, Andrew and Brad have refreshed their multigenerational practice around the social values of their clients. Bradley Sabin, 31, is the youngest of the three and one of the first financial advisors in the U.S. to receive a CSRIC™ credential – for chartered socially responsible investing counselors.
The Sabins have started asking their clients about their values and offering relevant new investments or a realignment of existing portfolios based on their investment objectives and financial solutions. The response has been positive, Bradley says. “We’ve just seen their eyes light up when they know that we are going to be thinking of a deeper dive,” he says. “Common topics of discussion are climate change, tobacco and firearms.”
Millennials are often cited as the driving force behind sustainable investing, and the Sabins say their millennial clients are their most enthusiastic, as a group, for the firm’s new approach. But they say that their core group of clients in their 60s and 70s have also been eager to hear about it. “A lot of our older clients were very, very interested in this,” says Bruce Sabin.
All investing involves risk, including the possible loss of principal.
There is no assurance that investing based on Environmental, Social and Governance (ESG) considerations will be an effective investment strategy or that a strategy’s holdings will exhibit positive or favorable ESG characteristics. An investment strategy that takes in account ESG considerations is not solely focused on financial concerns and could cause it to forgo potentially profitable investment opportunities in certain industries, companies, sectors or regions of the economy, potentially resulting in underperformance relative to similar portfolios that do not take ESG considerations into account. Risks associated with investing in ESG-related strategies can also include a lack of consistency in approach and a lack of transparency in manager methodologies. Investors should not place undue reliance on ESG principles when selecting an investment.
The information contained herein constitutes general information and is not directed to, designed for, or individually tailored to, any particular investor or potential investor. It is not intended to be a client-specific suitability analysis or a recommendation to invest in any particular fund or investment strategy.