Recap of the 2019 NYC Impact Investing Conference

/ Planning Within Reach, LLC/

I attended an impact investing conference in New York City this month at the United Nations (UN). I had the privilege of hearing the UN's Chief Economist speak as well as large asset managers, leaders in the ESG (environmental, social, and governance) integration movement, and Moody’s.

The current state of impact investing.

The common theme throughout the conference was that impact investing and ESG integration is here to stay. Impact investing does not take anything away from traditional investing, but it is an additional layer of due diligence that the largest asset managers are incorporating.

ESG integration provides a more complete picture.

We are living in different times. In 2018, more CEOs were kicked out of their job for ethical issues than poor performance. With the Exxon Valdez spill in the late '80s, there was virtually no effect on the stock price vs. BP's oil spill where the stock price was cut in half. And there were multiple infractions on BP's part leading up to that spill. These are things that ESG investing considers.

Rating agencies are using ESG data to assess a company’s risk.

Moody's had an interesting point because they rate securities and they said ESG information is material and affects their ratings. They have been acquiring climate and weather-related data firms in the quest for more ESG information and they are training all of their analysts across all industries to be integrating ESG into their process.

Smaller advisors and individual investors have been slow to adopt ESG integration.

Most of the large asset managers are integrating ESG factors into their investment process. Small to mid-sized advisors and individual investors have been lagging behind. If you are interested in getting started:

  • Reach out to your HR person and ask - do we have an option in our 401k that considers ESG information? Even if they say no you can request it for the future.

  • Ask your financial advisor if they are considering ESG factors in their investment process? They should be able to speak coherently about their philosophy and how they are considering it.

Linda Rogers, CFP®, EA, MSBA is the owner and founder of Planning Within Reach, LLC (PWR). Originally from New Jersey, Linda services clients throughout San Diego county and nationwide. She leads the design of PWR's investment portfolios which utilize broad, low-cost investments that integrate environmentally, socially, and governance (ESG) factors.

Planning Within Reach, LLC (PWR) is a fee-only and fiduciary wealth management firm offering one-time comprehensive financial planning, ongoing impact-focused investment management and tax preparation services in San Diego and nationwide. PWR is a woman-owned firm that specializes in busy professionals and impact investors. Planning Within Reach, LLC and their advisors do not receive commissions and do not hold any insurance licenses or brokerage relationships.