2020 Net Impact Report

All Portfolios Make An Impact–
Is Yours Positive Or Negative

What is the impact in your portfolio?

Instead of doing positive impact investing and negative impact screening, we need to move to optimizing a unified overall score –your net impact. This net impact score accounts for the destructive nature and the beneficial nature of investments in one metric.

Unified Scoring System.

  • Enable investors to better align their investments with their values through increased transparency of the holistic impact of their portfolio.
  • First investment management firm in Canada to integrate Net Impact Scores across all of our impact funds.
  • ”Genus rates a company’s impactful product or service using the UN Sustainable Development Goals (SDGs) and determines the weighted average impact (positive and negative) revenue of the holdings to get a net impact score.”

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Stronger returns

Genus Fossil Free’s climate-friendly equity funds have both beaten their benchmark on an annualized basis for three years.

Better impact

Divesting from fossil fuels and reinvesting your money into cleaner and more efficient energy solutions can be a sound strategy.

Lower risk

Divestment reduces exposure to the energy sector’s volatility and the associated ‘stranded asset risk’ of carbon reserves devaluing prematurely.

Myth of underperformance

We developed this report to dispel the myth of underperformance when it comes to sustainable investing. Many investors are concerned that accounting for social and environmental impact in their portfolios means compromising return potential.

 

While past performance does not guarantee future success, the Genus live performance and results of the historical back tests show that no compromise is necessary.

 

We believe fossil fuel divestment has the potential to reduce overall portfolio risk due to potential energy sector volatility and stranded asset risk.

Stranded asset risk

Fossil fuels present a ‘stranded asset’ financial risk. Energy reserves such as coal, oil and natural gas, may lose substantial value due to changing regulations, investor interests and the growth of renewable energy sectors. For example, Norway’s sovereign wealth fund (the world’s largest at $860 billion) divested from fossil fuels in hopes of reducing its financial risk.

Methodology

The Fossil Fuel Divestment Report examines the three-year live performance results of the Genus Fossil Free CanGlobe Equity Fund, further substantiated by research going back almost 20 years.

 

The effects of climate change have triggered a global divestment movement. More than ever, people are voting with their wallets by directing investment away from polluters.

 

Divestment now could protect your assets in the future. But what to do with the money you divest from the fossil fuel companies? Answer: Reinvest in companies leading the way to a clean energy future.

*Fossil Free CanGlobe Equity Benchmark: 35% S&P/TSX Composite, 65% MSCI World (04/01/2015 – Present) Benchmark changed from 40% S&P/TSX Composite, 30% MSCI EAFE, 30% S&P 500 (04/09/2013 – 03/31/2015)