Talking points: sustainability, house prices and more

Posted: 13/05/2019

BL_Talking PointsSustainable boom

The number of sustainable equity and bond funds in the US soared from 235 in 2017 to 351 in 2018, according to a new report by investment research firm Morningstar. The total amount under management 
was $161bn. The firm’s Sustainable Funds US Landscape Report rebutted the commonly held belief that investors must sacrifice returns when they make investments on ethical lines. In 2018, 63% of sustainable funds performed in the top half of their categories, Morningstar found. The out-performance of sustainable funds was also evident over three and five years, with the majority of funds beating their category benchmark.

Household profits

Market timing can make a huge difference when it comes to buying property, according to research by estate agent Savills, reported in the Financial Times. The study revealed that the best year to have bought a house in the UK during the past 15 years was in 2009 – in the wake of the financial crisis. Savills’ analysis, based on Land Registry data for sales in 2018, showed that for those who bought in 2009 and sold last year, the average profit was £93,378. The previous peak was six years earlier in 2003. However, the number of 2018 sellers who bought in 2009 was just one in 40 – reflecting the general reluctance to acquire property when prices had fallen significantly. 

Parting company

A total of 1,452 US-based CEOs left their posts in 2018 – the biggest number since the financial crisis, according to outplacement company Challenger, Gray & Christmas. The firm’s CEO Turnover Report showed that the number of CEOs departing last year was close to the record year of 2008, when 1,484 CEOs left their post. The company behind the research blamed the high tally on a number of factors, including economic uncertainty, trade concerns and a changing regulatory environment. Eight CEOs left amid sexual misconduct allegations and another four as a result of allegations of professional misconduct. Of the 1,183 replacement CEOs recorded in 2018, 264 (or 22.3%) were women – up from 18.4% in 2017 and the highest proportion since the survey started tracking gender in 2013.

Climate change winners

Unilever, L’Oréal, Danone and Nestlé are the four consumer goods companies best prepared to deal with climate change, according to latest published research by non-profit organisation CDP. Previously known as the Carbon Disclosure Project, the organisation evaluated 16 global consumer goods companies in two sub-sectors – household and personal, and food and beverage. It assessed each of the companies on their business readiness for transition to a low-energy economy, considering four key areas: transition risks; physical risk (especially to water shortages across the value chain); transition opportunities; and climate governance and strategy. Unilever had the highest score overall and the lowest overall was Kraft Heinz. Among the more critical aspects of the report, CDP claimed that the companies’ spending on R&D was low, with almost 60% of the top 10 revenue-generating brands for each company having failed to deliver low-carbon innovations to market in the past five years. 

 


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