Environmental, social, and governance (ESG) investing is an investment approach that’s sustainable, impactful, and people-centric. It’s not just about “going green” or avoiding investing in tobacco companies and big oil. ESG investing asks questions, like what companies are currently bringing health to this system? Which ones are operating in such a way that they’ll still be around 30 years from now when our kids and grandkids are investing?
The companies that are innovative, planet-conscious, people-focused, and well-managed are the companies that will continue to grow. By looking at the ESG metrics of various companies, we can determine which are most likely to perform well, stay in business, continue growing, treat people right, and become long-term household names. ESG investing is all about putting your investment dollars into the companies you want to see grow and last. And that’s ROI investors can take to the bank.
Our unique approach to ESG investing
When you think about ESG investing, you probably focus on screening out the “bad” companies. The exact definition of “bad” varies by investor, but it may be oil companies, gun companies, tobacco producers, manufacturers with a history of unethical labor… The list goes on and on. But at Cook Wealth, we approach ESG investing a bit differently.
Instead of only screening out the bad, we build portfolios that intentionally support the good companies. We focus on values-based investing: Putting our dollars to work supporting the companies that are doing good in the world. That’s where we get our ESG mantra, do well by doing good.
Why the unique approach? Screening out only the bad guys is like saying, “I don’t want these three companies in my portfolio, but everyone else is a-okay!” And there’s nothing inherently wrong with that approach. But we believe in specifically supporting the companies that align with our values. We’re concentrating investment dollars into companies that are more likely to do something positive with the capital, while generating healthy returns for their investors.
Why should ESG-conscious investors work with Cook? Our ESG portfolios focus on sustainable impact and are non-concessionary.
The companies we include in our ESG portfolios have a positive impact on humankind. They’re combating poverty, creating clean water, using clean energy, developing planet-saving technologies, and more. In fact, at Cook we focus on three main humanity-friendly initiatives: Sustainable energy, clean water, and zero-carbon technology. We believe that companies with a positive, sustainable impact on these three areas will last for generations to come.
You may be wondering, why these three specific initiatives? Because a healthy environment and access to clean water are the first steps towards a flourishing humanity.
You don’t have to make concessions and give up returns just to focus your investments on companies that are doing good in the world. We can demonstrate, with supporting data, that ESG portfolios generally perform as well or better than traditional portfolios. We don’t have to say, “You could have a higher return, but since you want to invest responsibly, you have to lower your expectations.” These days, the companies that are genuinely ranking highly on the ESG scorecards are performing well and are poised for continued growth. Why? Because when companies do good to the planet and to people, they tend to do well financially too. It’s just good business! And we’re building strategies around that. Strategies which allow you to have impactful investments without giving up healthy returns.
Over the next few years, big businesses will be under tightening environmental, labor, equity, and diversity standards. ESG is the way the world is moving. Our ESG-conscious clients are ahead of the game. And we expect to see more money flowing in this direction every year.
Our basic ESG investing model
Our ESG model isn’t political. It’s diversified and it’s impactful. It’s also stable and growth-oriented. It’s for investors who want to see people happy, healthy, and cared for. The companies we include in our standard ESG portfolio are improving water conditions through conservation, technology, higher standards, or community initiatives. We’re also looking at companies that use clean energy, build electric cars, reduce fossil fuels, and develop new technology. These initiatives are all people-centric. And these companies are strong investments.
The companies we include in our ESG portfolios are also working towards reducing their carbon footprints and shifting to sustainable fuels. These companies are proactively changing their processes and moving towards zero net carbon, even before governments are mandating these strict regulations. They’re planting trees, capturing their carbon, upgrading their technology, and more. That’s good for business, good for the planet, and good for your portfolio.
You don’t have to sacrifice financial gain just to support the companies that have the same values you do. You just need a partner who can help you put your money to good work. At Cook Wealth, we’re passionate about ESG investing because we know what it can do for the community, the country, and the world. When people are happy and the planet is healthy, humanity can flourish.
Have more questions about socially-conscious investing and how it works? Grab a 15 minute spot on my calendar, or send us a message below.