*This article was originally written for our Swiss market, it may contain Swiss references.
So, you’re keen to invest in companies that share your values. That’s great!
Before you sign on the dotted line, you probably have a few questions you want to be cleared up. And if you’re anything like the Yova customers that have come before you, your first question will be something like this:
How does Yova decide whether or not a company fits my values?
It’s a great question. Investors should always ask this question.
You’ve probably heard of the term “greenwashing”. It’s a very real problem in our industry and beyond – where companies use sophisticated PR and advertising campaigns to make people believe they are more environmentally friendly than they really are. Like a nuclear power plant being environmentally friendly; Yes, CO2 emissions are pretty much zero, but what about nuclear waste? It’s not that simple.
If you look hard enough, you’ll find similar phenomena across the board. Gender equality, for example, might be written about in company policy, without much equal opportunity materialising.
A fashion brand might loudly celebrate its commitment to human rights, all while continuing to sub-contract parts of its manufacturing process to companies with less-than-transparent supply chains.
It’s a minefield out there. Part of our service commitment at Yova is that we look beyond the surface and cut through the PR spin. With access to the cold hard facts, we enable you to invest in the companies that are truly helping to create a world you want to live in.
Here’s how we do it:
We start with raw data: We work with independent experts to analyse the environmental and social performance of companies. Data is collected on more than 400 relevant metrics and organised according to more than 70 data points. Using this data, we measure and benchmark a range of factors, from emissions and exploitation of resources, through to human rights, and more.
We go beyond the numbers: We work with a specialised research provider to monitor corporate controversies reported in the media, as well as lawsuits, and fines. Importantly, the methodology captures reports in local languages, which may not appear in the media outlets that you follow.
We assess ‘cradle to grave’: When considering the environmental and social impact a company has, we analyse the entire lifecycle of its products. This includes raw material extraction, materials processing, manufacturing, distribution, use, repair and maintenance, as well as disposal or recycling.
We identify the innovators: An online tech company like Amazon might have low emissions. But that may come down to the nature of the work it does. We will check its performance against other companies in its sector (for example Google and Microsoft) and only include the ‘best of the best’ in this industry. Similarly, we don’t reject every player in ‘dirtier’ industries (for instance, cement producers). Instead, we look for innovators who are truly reducing their carbon footprint and making consistent progress in the right direction. After all, the world needs cement, just like the world needs online shopping. A good dash of common sense is applied – cleaner cement firms don’t get prioritised above solar energy companies!
We don’t rely on self-reported data: Our specialised research providers tap into a number of external information sources, and never ever assess a company according to its own unverified data. Stringent methodology is in place for the occasions when external information is corroborated against company-supplied information to build a more in-depth picture.
We do not ‘set and forget’: We stay up-to-date with changes in a company’s commitment to your values. Let’s say a corruption scandal breaks, and that company is in your portfolio. If your customer file indicates that social issues are important to you, we have a system in place to remove this company from your portfolio and replace it with a company that better fits your values.
That’s great. Where do I sign up?
The first step is to get your personalised impact investing strategy – it’s free and non-binding and coming soon for EU customers! Join our waitlist here to be among the first to try Yova when it launches in Germany.
Using our easy online tool, you pick the sustainable and socially responsible investment themes that are most important to you. We show you exactly what stocks we recommend you invest in. You can also adjust your financial goals and risk preferences. With every adjustment you make, our algorithm makes sure your portfolio is financially sound. This way, you can control where your money goes – without compromising your returns.