Investing in companies improving our world
What is sustainable investing?
Sustainable investing aims to identify companies that offer potential for strong financial returns while also demonstrating a commitment to sustainable business practices and positive impact. Sustainability is typically evaluated through analysis of environmental, social, and governance (ESG) policies, practices, and performance.
We believe an intense focus on sustainability has the potential to deliver returns to investors while also benefiting communities and the environment.
Katherine Collins,CFA, MTS, Head of Sustainable Investing
Environmental practices might include improving water quality or reducing carbon emissions. Social impact could involve fair labor practices and improvements in workplace equality and diversity. Governance issues relate to a company's leadership structures, board composition, and management incentives. As with any strategy investors should consider how these approaches might affect their overall investment plan.
We have resources for your client conversations (select a starting point):
ESG basics for your clients
Putnam's integrated approach
Putnam's impact report
Examples of sustainable business practices
The Leaders Fund favors companies committed to sustainable practices. The Future Fund favors companies solving sustainability challenges.
Investing in growing companies solving sustainability challenges
A research team with diverse skills
Our team has a unique, integrated process for understanding sustainability in the context of each company they research.
Katherine Collins, CFA, MTS, Head of Sustainable Investing
Experienced as an equity analyst, portfolio manager, and head of research at Fidelity, Katherine founded and led Honeybee Capital, a sustainable research firm, before joining Putnam in 2017.
Shep Perkins, CFA, Chief Investment Officer, Equities
As CIO of Equities, Shep is responsible for providing strategic direction to Putnam's portfolio managers and equity analysts. He joined Putnam in 2011 and is Portfolio Manager of Putnam Sustainable Leaders Fund as well as Putnam Global Equity Fund.
Stephanie Dobson, Portfolio Manager, Analyst
Stephanie brings together experience in interpreting and applying ESG data with skills in fundamental analysis and valuation of companies.
Alexander Rickson, CFA, Quantitative Analyst
Alex provides skills both in the interpretation of ESG data and its application to the processes of risk management and portfolio construction.
Linking impact and performance
Often, the same elements that create environmental and social benefits are driving positive financial performance.Read post
Key metrics from our first impact report
In this inaugural assessment, the Sustainable Investing team provides multidimensional views of our portfolios' sustainability metrics and social and environmental impact, including examples of portfolio holdings.
The Morningstar Rating™ for funds, or "star rating," is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and ten-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36 to 59 months of total returns, 60% five-year rating/40% three-year rating for 60 to 119 months of total returns, and 50% ten-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the ten-year overall star rating formula seems to give the most weight to the ten-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods. Ratings do not take into account the effects of sales charges and loads.