The global conversation around climate and social issues will make engaging in greenwashing more difficult, says Jacob Hegge, an investment specialist with J.P. Morgan Asset Management.
Hegge said the growing popularity of bonds that focus on environment, social and governance (ESG) excellence is helping to identify bad-faith players who try to appear more conscientious than they are.
He allowed that investing in green initiatives can be confusing, given unclear and sometimes conflicting definitions, but standardization is coming.
“It’s great to see all the activity around ESG, but a consequence of this increased activity means a greater dispersion in terminology,” he said. “As ESG investing continues to grow, we’d expect to see more standardization. But until then, it’s important to understand that navigating the landscape can be difficult.”
Hegge said investors should test the terminology used to define green projects.
“Is the data or testing methodology readily available for investors to use? Is it easy to understand? Are the definitions explained and easily accessible? These are things investors need to be looking out for,” he said. “It comes down to transparency and consistency. And as ESG investing continues to grow globally, we expect this standardization to be more prominent in the market.”
The hot ESG market makes it all the more necessary for investors to know what they’re buying, Hegge said. “We do think it’s important for investors to look under the hood and pay attention to what investment firms are saying when they title a fund as being ESG. They really need to make sure that investment products are staying true to the prospectus.”
Hegge said green and sustainability-linked bonds are being issued at record levels, and issues are likely to increase.
“This year alone, green social sustainability and sustainability-linked bonds are expected to reach a combined issuance of over a trillion [U.S. dollars], which is doubled compared to last year,” he said. “And … some expect that investment in green bonds will actually double and reach US$1 trillion for the first time in a single year by the end of next year.”
Hegge said many companies are at the beginning of their green journeys, and their success in meeting ambitious targets will reflect their commitment level.
“Don’t narrow your opportunity set by being put off by low ESG scores. The important part is whether these scores are improving over time. You can find sustainable bonds even if they don’t have a sustainable label in the market,” he said.
“The global fixed-income market is very large and there are a lot of opportunities out there.”
This article is part of the Soundbites program, sponsored by Canada Life. The article was written without sponsor input.
Major Value-Added Agriculture Investment Announced in Saskatchewan | News and Media – Government of Saskatchewan
Released on January 17, 2022
FCL To Build Canola Processing Plant And Canada’s Largest Renewable Diesel Facility In Regina
Today, Federated Co-operatives Limited (FCL) announced its plans to develop an Integrated Agriculture Complex (IAC) north of the Co-op Refinery Complex in Regina. The IAC will include a renewable diesel facility, as well as a new canola crushing plant in partnership with AGT Foods.
The FCL renewable diesel production plant alone represents a nearly $2 billion investment for the province and is expected to create more than 2,500 construction jobs and 150 permanent operating jobs. The entire IAC is estimated to have direct and indirect economic benefits of approximately $4.5 billion.
“This is a tremendous opportunity for Saskatchewan and for FCL and AGT Foods that will bolster the sustainability and economic goals of these companies and the province,” Premier Scott Moe said. “Our province has the food, fertilizer, and fuel the world needs, including renewable energy from canola grown and processed here, which speaks to the heart of our plan for economic recovery and growth as we work to build an independent, strong and sustainable Saskatchewan.”
The FCL-AGT canola crushing facility will ensure Saskatchewan exceeds its 2030 Growth Plan goal of processing 75 per cent of the canola grown in the province. It also supports the Growth Plan goal of increasing agriculture value-added revenue to $10 billion.
The FCL renewable diesel plant will have a production capacity of 15,000 barrels per day, or about 1 billion litres per year. The FCL-AGT canola crush facility will use 1.1 million tonnes of canola seed to produce 450,000 tonnes of oil, supplying approximately 50 per cent of the feedstock required for the renewable diesel plant, with the remainder of the supply being contracted from other canola crush facilities.
“We know the synergies between transportation fuel production and agriculture will play a vital role in Western Canada’s transition to the low carbon economy,” FCL CEO Scott Banda said. “We believe our Co-op Retailing System is well-positioned to integrate and capture the full agricultural value-chain in the production of fuel and value-added products. We are excited about our partnership with AGT and ultimately what this announcement means for value-added agriculture in our province.”
With facilities and outlets in 249 communities in Saskatchewan, FCL and local co-ops employ more than 10,000 workers across the province.
For more information, contact:
Trade and Export Development
Cross-border investment surged in November – Investment Executive
The cross-border activity was concentrated on debt securities, with foreign investors adding $31.4 billion worth in the month, up from $20.4 billion the previous month.
StatsCan reported that investors targeted federal debt — adding $8.6 billion in bonds and $6.5 billion worth of money market securities — along with $9.8 billion in corporate debt.
Conversely, foreign investors trimmed $1.3 billion worth of Canadian equities in the month.
“The reduction reflected retirements of Canadian portfolio shares resulting from cross-border merger and acquisition activities. Foreign purchases of Canadian shares on the secondary market, led by shares of chartered banks, moderated the overall reduction,” StatsCan said.
At the same time, Canadian investors ramped up their buying of foreign securities in November.
In total, domestic investors added $17.5 billion in foreign securities, StatsCan reported. This was up from $5.4 billion in October.
Canadian investors jumped into U.S. stocks in November, buying $7.4 billion worth of equities, up from just $652 million in October. Large-cap tech stocks and index funds were the primary targets, StatsCan said.
Additionally, investors bought $4.0 billion worth of non-U.S. foreign shares in November, reversing a $2.5-billion divestment in October.
Canadian investors also added $6.1 billion in foreign debt, including $2.8 billion in U.S. corporate bonds and $1.6 billion in U.S. government bonds.
In a research note, National Bank Financial Inc. (NBF) said November’s $17.5-billion net investment means Canadian investors acquired $144.4 billion worth of foreign securities during the first 11 months of 2021.
“In dollar terms, you won’t find a prior [year-to-date] tally remotely close,” NBF said, noting that the previous record was $73.3 billion about 15 years ago.
Even with the record flow into foreign securities, net portfolio flows are still positive for Canada, as foreign buying of Canadian securities has been even stronger.
“An improved current account means Canada is less reliant on foreign inflows,” NBF said. “Still, the apparent abandonment of Canada by domestic investors is part of an overall capital bleed that needs redressing.”
4 Must-Have TFSA Stocks for Any Investment Goal – Yahoo Canada Finance
Written by Amy Legate-Wolfe at The Motley Fool Canada
If you have a Tax-Free Savings Account (TFSA), then you hopefully have an investment goal to go along with it. Now, we could drill down into specific savings goals, but, honestly, those goals change! What someone wants at 30 will be different at 50, and so on. First, it’s student debt, then a house, then a child, their education, and, of course, retirement.
Frankly, you shouldn’t have to juggle your investments every time you come up with a new goal. In fact, one of the main points of investing is to buy and hold for as long as you can. Sure, you can take out cash as your goals come in, but you should be able to hold onto them for as long as you want.
With that in mind, here are four TFSA stocks that will help you achieve any investment goal.
If you’re going to have long-term TFSA stocks, you need stable companies to get you there. That would definitely include Fortis (TSX:FTS)(NYSE:FTS). The utility company has been growing its dividend each year for almost 50 years. This comes from a stable business plan of growth through acquisition.
Investors have been flocking to Fortis as one of the TFSA stocks they want because of this stability — especially during the market pullback. The company is basically recession proof, providing gas and electric utilities to 3.4 million customers. You need the lights on no matter what, making it a strong choice for any investor.
Fortis shares are up 16% in the last year with a dividend yield of 3.63%.
The Big Six banks may be trading at all-time highs, but there’s a reason. And that reason is why they’re TFSA stocks for any investment goal. The banks managed to get out of the market drop relatively unscathed, and yet they still have so much cash on hand to make up for lost time. And that comes through solid dividend jumps.
But Toronto-Dominion Bank (TSX:TD)(NYSE:TD) has even more to offer. TD stock offers the most growth of the Big Six banks, with the most amount of credit card partnerships, growing online and United States presence, and the most loan options for solid revenue streams. And yet even after all this growth, TD stock still trades at just 13.42 times earnings.
TD stock is up 41% in the last year, with a dividend yield of 3.47%.
If you have the cash to invest, Constellation Software (TSX:CSU) is one of the few tech stocks that remains a stable investment. The company has been an acquisition powerhouse, identifying the software companies it believes will thrive with incredible expertise.
It’s those experts that have managed to keep the company growing at a stable clip, even as other tech stocks burn around it. Constellation shares have been steady as a rail, growing through venture funds and seeing revenue rise 30% year over year during the last quarter. It’s one of the TFSA stocks any investor should add as soon as possible before it rises even more.
Shares of Constellation are up 34% in the last year, and it recently boosted its dividend to offer a yield of 0.24%.
Finally, Nutrien (TSX:NTR)(NYSE:NTR) may be on the newer side, but don’t count this out among TFSA stocks. People need to eat, and Nutrien is now the world’s largest crop nutrient provider. As arable land decreases and climate change increases, Nutrien will be a necessity for any portfolio.
Nutrien continues to grow through acquisition. In the last few years, it has increased its digital presence at an incredible rate. This kept revenue coming in at an incredibly important time — for the company and farmers. Now, it’s nearing the three-digit mark and isn’t likely to come down.
Shares of Nutrien are up 37% in the last year, with a yield of 2.57% for investors.
Should you invest $1,000 in Air Canada right now?
Before you consider Air Canada, you may want to hear this.
Motley Fool Canadian Chief Investment Advisor, Iain Butler, and his Stock Advisor Canada team just revealed what they believe are the 10 best stocks for investors to buy right now… and Air Canada wasn’t one of them.
The online investing service they’ve run since 2013, Motley Fool Stock Advisor Canada, has beaten the stock market by over 3X. And right now, they think there are 10 stocks that are better buys.
Fool contributor Amy Legate-Wolfe owns TORONTO-DOMINION BANK. The Motley Fool recommends Constellation Software, FORTIS INC, and Nutrien Ltd.
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