GREEN INVESTMENTS. NATASHA FESTA. Richardson GMP. Independent High Net Worth Brokerage Firm Interviewed: Neil Gregory, CFA, BComm Stan Wei, BA, CIM, APM Penny Walker, FSCI, CIM. WHAT ARE GREEN INVESTMENTS?. WHAT ARE GREEN INVESTMENTS?. Relatively New Term
GREEN INVESTMENTS NATASHA FESTA
Richardson GMP • Independent High Net Worth Brokerage Firm • Interviewed: • Neil Gregory, CFA, BComm • Stan Wei, BA, CIM, APM • Penny Walker, FSCI, CIM
WHAT ARE GREEN INVESTMENTS? • Relatively New Term • Usually Called SRI (Socially Responsible Investing) • Green vs. Ethical Funds • Jantzi • http://www.sustainalytics.com/services/responsible-investment-services
Neil Gregory’s Definition • “It’s more than a color, as I don’t believe the term “green” is at all representative of the concept the term is or should be trying to communicate to investors. If pressed I would say a better terminology may be “environmentally advantageous.” [There are] companies whom have figured out how to use an environmental overlay in their business to advance their competitive position in the marketplace”.
Stan Wei’s Definition • “Typically a company that invests in technology that uses aspects of our surroundings to provide a net benefit to all who are involved, but also creates a zero/minimal footprint. For example: solar, geo-thermal, wind [technologies] to name a few”.
Penny Walker’s Definition • “Companies who offer an alternative to the norm whether it be solar or wind or new technologies to advance society without using an over abundance of energy”.
Opinions on Green Investments • “To a great extent I believe the political environment has made “being green” a bit cliché, and in the end we have likely wasted billions of dollars on niche technologies/markets, when we would have been better off investing into greater research on how to use what we have more efficiently” - Neil Gregory • http://www.youtube.com/watch?v=j9QQcP_Y1II&feature=related • The Ethanol Myth
Opinions on Green Investments Penny Walker Stan Wei “I’m all for Green Investments. Unfortunately economics are dependent on other inputs and their prices, namely oil. This type of investing usually has a very low rate of return” • “I don’t specialize in Green Investing because it is hard enough to to pick stocks that go up. It becomes even harder when you put parameters around [your investing] like having your [invested] companies be green”
Green Investments and the Stock Market • Misconceptions about Green Investing • Correlation between the environment and the stock market • Green Investing and current business models
Misconceptions • There is profitability in investing green, but it may not be considered “fully Green.” - Stan Wei • “Just because its green doesn’t mean it should automatically be a good investment.” - Neil Gregory • “Green is not only wind, solar, and recycling, but it can also include companies who make an effort to create alternatives.” Penny Walker
Environment and Stock Market • “You only need to look back to the impact of the BP deep water rig explosion in the the Gulf of Mexico to see the impact it can have on the market, and the spin off in other areas.” – Neil Gregory
Changing Business Models • In order to stay competitive oil and gas companies are becoming more innovative in an attempt to reduce their carbon footprint • Reflected on the stock market • Reflected in investor criteria
Oil and Gas Companies and Environmental Technologies • Suncor • “Suncor is leading in remediation of tailing ponds.” – Stan Wei • http://sustainability.suncor.com/2010/en/responsible/2634.aspx?id=3748
Oil and Gas Companies and Environmental Technologies • Cenovus Energy • Funding Innovations: Environmental Opportunity Fund • http://www.cenovus.com/news/more-than-fuel.html