corporate governance

ESG & You: Investing in Worthy Ways

photo shows sun shining through tree branches

We’re all about the long term at 228 Main. And we’re interested in companies that are oriented to the long term… like the ones trying to take care of the environment, operating in ways that are sustainable for employees and clients and suppliers, removing barriers to entry—these are all long-term processes.

And in our opinion, we believe companies like this happen to do better, too.

Maybe you’ve heard about ESG investing—the practice of putting money into those investments that address environmental, social, and governance issues.

We’re not interested in fads, but this style is all about the long term.

Any human endeavor will have its flaws, but we’re figuring out how to bring the best qualities of ESG into our work with you.

First, we can keep certain kinds of companies off our buy list. Those businesses that deal in tobacco, alcohol, and gambling, for example, don’t align with many people’s beliefs about individual wellbeing.

Second, we can add certain companies that meet sustainability criteria, like environmental benchmarks or diversity among corporate leadership.

Trying to grow your bucket is always at the heart of our work. But we shouldn’t have to choose between performance and other worthy results. Let us know if ESG goals are a priority for you.


Environmental Social Governance (ESG) investing has certain risks based on the fact that the criteria excludes securities of certain issuers for non-financial reasons and, therefore, investors may forgo some market opportunities and the universe of investments available will be smaller.


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Heavy is the Head that Wears the Crown

© Can Stock Photo / tashka

Pop quiz: if Joe Smith from Detroit works for General Motors, who is at the top of his chain of command? His boss’s boss’s boss’s boss, in other words? (I pick GM as a random example, but this exercise is true of any publicly traded company.)

If you own any shares of General Motors, the answer is you, personally. Makes you feel pretty important, right?

Of course, there are some caveats. General Motors has over 1 billion shares of stock floating around, and this is not an unusually large amount for an exchange-listed company. If you only own, for example, 1 share of GM stock you have less than a one-billionth part of the collective ownership authority over the company. Still, as a stockholder you are entitled to a have a proportionate voice in how the company is run, however small that voice may be. It is a powerful idea, and this idea of shared ownership is a cornerstone of our modern economy and way of life.

The most visible parts of your rights and responsibilities as a shareholder are, inevitably, the proxy voting materials that you may periodically receive as a stock owner. Your shares entitle you to vote on the company’s board of directors, as well as other significant decisions that the company may make from time to time.

For smaller investors such as you or I, shareholder materials can sometimes be more of a nuisance than anything else. Even if we got together with all of our clients and voted together as a bloc, we still would not command enough shares to influence a shareholder vote much. Moreover, we would generally want to stick with the default recommendation of the company management. If we disagreed with the job management was doing, we would not want to invest in the company in the first place! There are sharks out there in the investment world that look to gobble up companies and take over their management, but in here we are all pretty small fish—we just look for successful companies that we can swim along with. Most of the time, we are content to leave shareholder decisions up to the big fish.

That said, it does happen occasionally that a vote or shareholder election comes up that may have some effect on you personally. We keep an eye on what shareholder materials get sent out so that we can get in touch if something comes up that you ought to act on.

The bottom line is that the privileges of stock ownership can wind up translating into a lot of mail, and it can be difficult to sort through it all sometimes. Clients, if you receive any shareholder communications that you do not understand, please do not hesitate to pick up the phone or email us for help making sense of it.


The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

Stock investing involves risk including loss of principal.