Sustainable Investing  

How to benefit from CSR

  • To be able to explain what CSR means to clients.
  • To understand different types of sustainable investment.
  • To be able to see how CSR can mitigate long-term risks.
CPD
Approx.60min
How to benefit from CSR

Introduction

Corporate social responsibility (CSR) is a well-used phrase among the corporate world but what does it really mean?

Can a company have good CSR credentials but still be a bad investment? Can a company claim to do good in the community and yet still be a big risk when it comes to sustainability? And what does this mean for investors in these companies?

According to Leon Kamhi, head of responsibility at Hermes, there are "several high-profile examples of major corporates which have embraced CSR as a fundamental value".

Yet, as other commentators have pointed out, there are just as many high-profile examples of businesses where CSR is not at the heart of their business - and therefore poses a risk to the ongoing success of that company.

Moreover, when it comes to checking a company's environmental, social and governance (ESG) credentials, there are some businesses that just are not getting up to speed with regulation on climate change or social responsibility, or gender diversity.

All this can pose risks to investors.

This guide, in association with Rathbones, explains why CSR is an important part of a fund manager's selection process, what it means to them as institutional investors - and therefore why it should also matter to retail investors. 

It also looks at the risks of not getting it right, and how this might affect the end investor, and touches on the many 'flavours' of ethical investing, and how the adviser has a vast toolkit at his or her disposal when it comes to advising clients.

This guide is worth an indicative 60 minutes of CPD.

Contributors to this guide: John David, head of Rathbone Greenbank Investments; Matt Crossman, engagement manager for Rathbone Greenbank Investments and stewardship director for Rathbones; Leon Kamhi, head of responsibility for Hermes Investment Management; Thierry Bogaty, head of SRI expertise at Amundi; Stephanie Maier, director of responsible investment for HSBC Global Asset Management; Jennifer Walmsley, partner at Arkadiko Partners; Lisa Beauvilain, head of sustainability and ESG for Impax Asset Management; Rose Beale, thematic analyst in the responsible investment team at Columbia Threadneedle Investments; Sandra Crowl, member of the investment committee at Carmignac; Hargreaves Lansdown; John Ditchfield, director at Castlefield; Anna Sofat, managing director of Addidi Wealth; FE Analytics; the Department for Culture, Media and Sport; The American Accounting Association.

Simoney Kyriakou is deputy editor of Financial Adviser

In this guide

CPD
Approx.60min

Please answer the six multiple choice questions below in order to bank your CPD. Multiple attempts are available until all questions are correctly answered.

  1. According to Mr David, the term 'CSR' has grown beyond what?

  2. Ms Sofat says CSR scores are one way of doing what?

  3. The sort of areas Ms Crowl believes should be scrutinised are what?

  4. Why does Ms Beale say it is difficult to test a company's CSR approaches?

  5. Mr Crossman says CSR must go to the heart of what?

  6. Ms Crowl says the investor and the fund manager must what?

Nearly There…

You have successfully answered all the questions correctly, well done!

You should now know…

  • To be able to explain what CSR means to clients.
  • To understand different types of sustainable investment.
  • To be able to see how CSR can mitigate long-term risks.

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