As more investors become aware of their growing impact on the world, many are turning to investments that include environmental, social, and governance principles.
In the upcoming webcast, What Advisors Need to Know About ESG During Volatile Times, Margaret Leung, Head of Specialist Distribution, Nuveen, and Stephen Noll, Managing Director, Nuveen, will show how ESG investing manages risk, increases returns, and positions your portfolio for the future.
For example, investors can fill out their equity portfolio with U.S. ESG equity-related ETFs, such as the Nuveen ESG Large-Cap Value ETF (BATS: NULV), Nuveen ESG Large-Cap Growth ETF (NULG), Nuveen ESG Mid-Cap Value ETF (NUMV), Nuveen ESG Mid-Cap Growth ETF (NUMG) and Nuveen ESG Small-Cap ETF (NUSC), which screen companies of various market capitalization and asset categories for environmental, social and governance principles.
The Nuveen ESG International Developed Markets Equity ETF (NUDM) and Nuveen ESG Emerging Markets Equity ETF (NUEM) also align investors’ international equity investments with their values.
At Nuveen, the money manager employs several other ESG criteria to better target companies that exhibit socially responsible characteristics. Specifically, Nuveen applies an ESG rating to capture an issuer’s performance on significant ESG risks relative to peers, a controversy score that captures an issuer’s exposure and response to event-driven controversies, a controversial business investment component that captures an issuer’s activity in industries that may cause significant social harm and low-carbon criteria that captures the carbon intensity of an issuer based on involvement in specific industries.
Additionally, the three ESG factors cover three separate broad categories. Environmental refers to climate change, greenhouse gas emissions, resource depletion, including water, waste and pollution, deforestation. The social aspect covers working conditions, including child labor, community and indigenous populations, operations in conflict zones, health and safety, employee relations, and diversity. Lastly, the governance factor is based on executive pay, bribery, and corruption, political lobbying and donations, board diversity and structure, tax structure.
The ESG factors are an all-inclusive categorization, so investors should not see this as something like an exclusionary based investment approach. Furthermore, the responsible investment and ESG-related investment strategy is not indented to sacrifice performance or lower returns for the sake of achieving their goals. In essence, ESG investments have even shown to generate improved risk-adjusted returns over time.
Financial advisors who are interested in learning more about ESG investments can register for the Tuesday, June 2, webcast here.