Institutional investors can achieve competitive financial returns when implementing sustainable and responsible investment strategies, while at the same time meeting their fiduciary responsibilities. This is the major finding of a new guide for institutional investors entitled "Sustainable and Responsible Investment Strategies: A Guide for Fiduciaries and Institutional Investors." The guide is published by SRI World Group, Inc., a financial information services and consulting firm.
The guide is focused on institutional investors such as pension funds, universities, religious organizations, and foundations. It details how institutional investors – representing approximately $7 trillion in assets – can customize strategies to identify risk and capitalize on market opportunities, while simultaneously generating social and environmental benefits for their participants and beneficiaries. Strategies analyzed in the guide include corporate governance, proxy voting, shareowner resolutions, screening, and best-in-class investing.
"Our research illustrates that any institution can implement sustainable and responsible investing without abrogating its fiduciary responsibilities," said Jay Falk, President of SRI World Group. "We are pleased to be the first in providing a framework that helps institutions analyze these investment options, apply them, and profit from them."
The financial performance of sustainable and responsible investment strategies is examined from four different perspectives: indexes, mutual funds, institutional portfolios, and composite portfolios. Through this examination, SRI World Group concludes that these strategies provide competitive long-term financial returns when compared to appropriate benchmarks.
The guide is designed for trustees and institutional staff members, but contains data and documentation that investment consultants may find valuable as well. According to Falk, "This comprehensive guide to incorporating social, economic, and environmental factors into the investment process enables institutional investors to make informed decisions about the potential benefits to their organization, members, participants, and beneficiaries."