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Please read this important information before proceeding further. It contains legal and regulatory notices relevant to the information contained on this website.
The information contained in the Website is NOT FOR RETAIL CLIENTS - The information contained in the Website is solely intended for professional investors, defined as investors which (1) qualify as professional clients within the meaning of the Markets in Financial Instruments Directive (MiFID), (2) have requested to be treated as professional clients within the meaning of the MiFID or (3) are authorized to receive such information under any other applicable laws. The value of the investments may fluctuate. Past performance is no guarantee of future results. Investors may not get back the amount originally invested. Neither Robeco Institutional Asset Management B.V. nor any of its affiliates guarantees the performance or the future returns of any investments. If the currency in which the past performance is displayed differs from the currency of the country in which you reside, then you should be aware that due to exchange rate fluctuations the performance shown may increase or decrease if converted into your local currency.
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Sustainable Investing
Greenwashing
Greenwashing is the practice of trying to make people believe that a company is doing more to adopt sustainability than it really is, often for public relations reasons.
Some claim to be more sustainable when they are in fact only making token gestures towards it. For a company, this could be doing something like claiming to have cut a carbon footprint by installing sensors that turn lights off to save energy, when the underlying business is highly polluting.
For an asset manager, greenwashing could be making a small gesture towards sustainability, such as by excluding an obvious candidate from portfolios like a weapons manufacturer, while not applying environmental, social and governance (ESG) factors to the rest of the portfolio. It could also be the case that if an asset manager has a very small proportion of its total assets under management engaged in sustainability – say 1% - then the other 99% is not sustainable. That is also greenwashing.
As a pioneer of sustainable investing, Robeco has long believed that true sustainability means three things. Firstly, strategies that only apply simple exclusions and are still labeled as being ‘sustainable’ should be a thing of the past. There should be more to sustainable investing than just using a negative screen.
Creating returns that benefit the world we live in
Secondly, a strategy can only really be sustainable if it is also financially sustainable. How do long-term ESG trends and external costs such as climate change, loss of biodiversity and rising inequality lead to changes in business models? This means thinking hard about how sustainability affects companies and investment strategies.
Thirdly, active ownership is important. Truly sustainable investors will use voting and engagement to encourage companies to become more sustainable. Passive strategies, for example, cannot do this – they simply scoop up the wheat with the chaff.
To try to make things clearer, and avoid greenwashing, the EU is in the process of defining an ecolabel, so that the public can trust what is said to be sustainable. Other ‘SRI’ labels can be misleading. In Robeco’s view, if a strategy doesn’t have ESG properly integrated, it’s greenwashing.