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Invest in the Future You Want

With our Socially Responsible Personal Strategy, you can invest in companies doing a better job managing environmental, social, and corporate governance related issues.

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What Is Socially Responsible Investing (SRI)?

Historically, socially responsible investing (SRI) often meant excluding companies or categories (such as tobacco or firearms) from your portfolio in order to align your investments with your personal beliefs.

Over time, SRI has evolved from just an exclusionary approach into an investment strategy that considers both financial return and an investor’s values, such as seeking out companies with a positive social and/or environmental impact on the world.

Why Socially Responsible Personal Strategy?

Our Socially Responsible Personal Strategy® utilizes a combination of exclusive and inclusive filters. We take a best-in-class approach to the U.S. equity component of portfolios, seeking out companies doing a better job managing environmental, social and governance (ESG) issues.

Socially Responsible Personal Strategies include the same benefits as our core Personal Strategies®, such as optimal asset class mixes that aim to maximize return and reduce risk, our Smart Weighting methodology within U.S. equities, tax management, and disciplined rebalancing.

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Socially Responsible Investing

What Are ESG Rankings?

E, S, and G represent the three main pillars used to evaluate the “social responsibility” of companies.

ENVIRONMENTAL

Climate Change

Renewable Energy

Sustainabilty

GOVERNANCE

Management Structure

Board Independence

Executive Compensation

Exclude GamblingExclude WarsExclude WeaponsExclude TobaccoExclude XXX Rated

There is no global standard for evaluating ESG metrics, but some third-party firms have established ranking methodologies. Personal Capital chooses to partner with Sustainalytics, a global leader in ESG research and ratings. To learn more about the Sustainalytics methodology, read about our article “How ESG Ratings Agencies Work.

How does ESG impact your portfolio's performance?

Numerous third-party studies have shown that performance does not have to suffer in order to invest more responsibly:

  • Deutsche Bank and the University of Hamburg compiled evidence from more than 2000 empirical studies. They concluded that an investor in ESG funds “....can expect to lose nothing compared to conventional fund investments”.
  • Harvard Business School (Corporate Sustainability: First Evidence on Materiality), found that companies performing better on material ESG issues were enhancing value for shareholders.

Interested in learning more about SRI and ESG?

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