How is Coronavirus Affecting ESG Investing?

The era of Coronavirus has created opportunities for companies to shine.

And ESG Investors are taking notice.

As we pass the six-month mark of living and adjusting to life with COVID-19, several positive insights have come out of an otherwise challenging, and for many people, tragic time.  The pandemic has shown the fragility of the planet, its complexity and interconnectedness in terms of demand and supply in trade and commerce, “and how these can be under threat if not sustainable” as noted by Nigel Green, CEO and founder of the financial advisory firm deVere Group (Environmental Analyst).

So what does this mean for corporations and investors?  Mr. Green adds:  “Investors are increasingly aware that it is possible – and increasingly necessary – to make a profit while positively and proactively protecting people and the planet.”

How ESG Investing Affects Corporate Behavior

This type of investing sensibility is called ESG Investing.  It can also be thought of as sustainable, responsible, or value-based investing.  It means that investment decisions include consideration of a company’s positive actions for the environment, their customers and employees/vendors as well as overall corporate responsibility and ethics.  Over 25% of investment dollars are now targeted toward ESG factors.

Investor attention is positive reinforcement for a company in many ways and encourages a company’s ESG initiatives.

The bottom line is IMPACT.

Here is an example:

ESG investing is significant globally as well. As of last July, the Hong Kong Exchange instituted mandatory disclosure of ESG activities.

Zoom Video Steps Up

StockSquirrel commends these companies for going above and beyond during the Coronavirus crisis.

Zoom Video used to see a maximum of 10 million sessions per day. In March, that soared to 200 million sessions per day. Zoom recognized the significant impact it could have during this crisis, especially in education.  Free upgraded accounts were made available to all K-12 educators and support was put in place to educate the educators on the best ways to engage students over Zoom to achieve the best possible learning outcomes- and more importantly, to help students have the continuity of ongoing education and socialization.

Coty, L’Oreal, LVMH and Unilever

Last March some beauty companies refitted their facilities to produce needed items such as hand sanitizer. These companies include Coty Inc., L’Oréal, and LVMH.  Unilever went even further and donated $20 million in the U.S., in the form of products and services, as well as $540 million in cash relief worldwide including refugees who were displaced from their homes.

You can help to shape our future!

StockSquirrel is committed to informing you about great companies that are working to make a difference so that your investment dollars can make a difference.  Here is the philosophy of David Gardner, cofounder, The Motley Fool.

“Make your portfolio reflect your best vision for our future. Always be thinking ahead. Be optimistic. Think about the world that you want to create, because sure enough your dollars and mine, our capital, is helping shape the world.”

That’s amazing!  As individuals, we really do have the power to change the world.