Investing with Your Heart is a Good Thing

If you’ve found yourself here, you are curious about what it means to invest according to your values. Longwave Financial is committed to providing sustainable wealth management strategies in a holistic manner for our clients. We take an approach that integrates ethical, sustainable and deliberate management not just in the investments we recommend but through the entire value chain. Our approach considers not only your priorities but how we as a firm, along with our investment partners, can play a role in delivering our values-based services.

Many of our clients prioritize their families and the next generation. By considering our capital’s impact on both local and global communities, we can work towards a future with a cleaner environment, more equitable systems and better governance.

What is ESG Investing?

The first forms of modern day socially responsible investing surfaced in the 1960s and ‘70s alongside the fervor of the Vietnam war and South African apartheid. Endowments of universities responded to what they saw as injustices and divested from South Africa. By 1988 there were 155 university endowments that had fully liquidated their investments in the country. Off the back of this movement, the “SRI” (socially responsible investing) process was born. It encompassed the traditional “sin stock” exclusions such as tobacco, alcohol, firearms, and gambling, but newly included limiting investment in regions which lacked human rights and companies that exploited those communities. The environmental piece was a further revolution, that again reinvented the values-based investing space in the 20th century. Along with the first Earth Day in 1970 came the emergence of the first “sustainable” investment funds. In the 1980s the Exxon Valdez and Chernobyl disasters drew new attention to sustainable considerations, and to how poor environmental business practices can hurt returns as well as communities. In 2004 the United Nations Principles for Sustainable Investment combined the separate theories into a unified “ESG” or environmental, social, and governance framework. 

However, with increased demand comes increased supply, and not all products are created equally. An explosion of funds calling themselves “ESG,” “SRI,” and “sustainable” make their way into client portfolios today, with little or no scrutiny as to what these terms mean and what the funds could own. With little to no support from technology or third-party watchdogs, it was buyer beware when it came to these ESG funds that were often expensive, varied tremendously and lacked transparency. The term “greenwashing” was coined to describe this: when an investment product labels itself as an ESG-aligned vehicle yet does fundamentally little to address the framework’s legitimate concerns.

Our Sustainable Investing Principles

We strive to make an authentic contribution to the ESG space by evaluating key ESG metrics using 3rd party data providers at USSIF, YourStake and As You Sow in order to create a more comprehensive understanding that looks past the accounting statements of businesses and considers how they may be adversely affected by their own actions on the world around them.

• Animal Welfare

• Air and Water Pollution

• Corporate Governance

• Tobacco, Alcohol and Firearms

• Human Rights

• Equal Employment Opportunity