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Press: Investment World Shifts to Sustainability? Portland Business Journal (01/13)

Investment world shifts toward sustainability — or does it?

An event last week at the Ecotrust building brought together a panel of impact investors and a room heavily peppered with investment advisers.

The conversation was all about making investments that deliver solid returns while addressing some aspect of sustainability— environmental impact, social justice and economic health.

The sponsors of the event were JPS Global Investments and Calvert Investments and representatives from both talked about the growing trend of impact investments.

For example: Proactively choosing to invest in businesses that take sustainability seriously is a hedge against future uncertainty, suggested Jan Schalkwijk, president and founder of JPS Global Investments. Costs associated with climate change are still external, but that will change in the future.

“Eventually all the costs will end up on the balance sheet,” Schalkwijk said.

Geoff Ashton, senior regional vice president for Calvert Investments, talked about a time when investing with one’s heart was sure to damage one’s wallet.

“I’m happy to say it doesn’t do that anymore,” he said.

In fact, Ashton reports that during the economically buffeted “lost decade” of 2000-2010, Calvert’s sustainable and responsible investment funds returned a 5.5 percent return while the Nasdaq lost value.

Following the panel discussion — which featured impact investors Ecotrust Forest Management, Upstream 21 and Sustainable Investment Fund 2012 — questions arose from investment advisers expressing keen interest among their clients in making impact investments. How can the average investor put money to work for impact?

I couldn’t help but notice that the conversation was distinctly different from one earlier this month when executives from Ferguson Wellman Capital Management invited the staff from the Portland Business Journal for a preview of the investment landscape in 2013.

Ferguson Wellman, a much-respected investment advisory firm, has a great track record of asset growth. Its Chief Investment Officer George Hosfield walked us through a detailed forecast of investable themes — housing’s recovery, growing U.S. production of natural gas and oil, a comeback of consumer spending.

There was no mention of environmental, social and governance issues — themes we’ve been looking at in our Sustainable Alpha series — never mind sustainability or impact.

I asked Hosfield after the presentation — held in the firm’s sleek conference room — if he was hearing from any of the firm’s 606 high-net-worth and institutional clients asking for socially responsible investing options.

The short answer was: No.

Mary Faulkner, Ferguson Wellman’s vice president of marketing, clarified that the firm’s tailored approach means that each client has a custom portfolio and that some of those clients request portfolios that reflect their values.

But that doesn’t change the fact that Hosfield doesn’t see sustainability altering Ferguson Wellman’s overarching focus any time soon.

Which makes me wonder: Which investment outlook is in a bubble and which is rooted in the real world?

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posted in jps press on january 30, 2013.