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Why Does Trump Want To Regulate Sustainable Investing – OilPrice.com

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Why Does Trump Want To Regulate Sustainable Investing? | OilPrice.com

Tsvetana Paraskova

Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. 

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    While asset managers and investors increasingly emphasize sustainable investment in their criteria for investing in funds and equities, the Trump Administration is proposing a rule that would limit retirement funds’ investments in retirement plans based on environmental, social, and governance (ESG) criteria.  

    Some of the world’s largest asset managers, including BlackRock and Fidelity Investments, oppose the proposed regulation as burdensome and limiting fiduciaries’ ability to consider financially material ESG factors when picking investments. 

    Critics of the plan range from those who see the proposed regulation as flawed in its assumptions that sustainable investing is not financially material, to those who see it as a rule that would limit options for participation and diversification for retirement plans, and to those that see it as a not-so-subtle push to help the oil and gas industry by limiting fiduciaries’ investments based on sustainability criteria. 

    The U.S. Department of Labor, which proposed the new rule in June, wants retirement plan fiduciaries to select investments and investment courses of action “based solely on financial considerations relevant to the risk-adjusted economic value of a particular investment or investment course of action.”  

    “The Department is concerned, however, that the growing emphasis on ESG investing may be prompting ERISA plan fiduciaries to make investment decisions for purposes distinct from providing benefits to participants and beneficiaries and defraying reasonable expenses of administering the plan,” it said in the proposed rule. Related: The Threat Of Oil Nationalism In Argentina

    During the 30-day comment period, prominent asset managers – including BlackRock, Fidelity Investments, State Street Global Advisors, and Putnam Investments – expressed concerns that limiting ESG criteria for investment also limits options for retirees, especially in light of evidence that sustainable indices have outperformed non-sustainable ones.  

    “The Proposal creates an overly prescriptive and burdensome standard that would interfere with plan fiduciaries’ ability and willingness to consider financially material ESG factors, regardless of their potential effect on the return and risk of an investment,” BlackRock said, noting that the proposal “would impose significant costs and burdens on ERISA plans that would ultimately be detrimental to plan participants and beneficiaries.”

    Fidelity Investments said that “the Proposal would result in far-reaching, harmful consequences for ERISA plans and participants, as well as a burdensome effect on plan fiduciaries if it is implemented in its current form,” while State Street Global Advisors noted that the proposed rule “unfortunately discourages such integration by U.S. private sector plan fiduciaries, potentially disadvantaging plans, participants and beneficiaries by restricting access to an entire type of long-term, value-driven investment that could help ensure future retirement security.” 

    Putnam believes “that the evidence that thoughtful integration of relevant ESG considerations may in fact improve returns and reduce risk is compelling.”  

    Of the total more than 8,600 comments on the proposed rule, more than 95 percent of comments opposed the proposed rule, and only 4 percent of comments expressed support, according to an analysis of the Forum for Sustainable and Responsible Investment (US SIF) and several investor organizations and financial industry firms. 

    “The proposed DOL rule is a thinly disguised political attack on ESG investing, with no legitimate factual basis. As the overwhelming negative response demonstrates, investors across the spectrum see environmental, social, and governance factors as a critical part of the analysis of the long-term value of investments,” Interfaith Center on Corporate Responsibility (ICCR) Chief Executive Officer Josh Zinner said. 

    Jon Hale, Morningstar’s director of ESG research for the Americas, wrote at the end of July, “while there is no demonstrated need for the rule other than the Trump Administration’s desire to protect the fossil-fuel industry, the biggest problem with the proposal is that it reflects a (willful?) misunderstanding of what ESG investing is about today.”  

     According to 2019 Morgan Stanley research, which studied the performance of nearly 11,000 mutual funds between 2004 and 2018, sustainable funds’ returns were in line with those of comparable traditional funds. Morgan Stanley saw evidence that sustainable funds are more stable during periods of extreme volatility, demonstrating lower downside risk. At times of uncertain markets, sustainable funds “may offer a layer of stability for investors looking to reduce volatility,” Morgan Stanley said. 

    Regardless of the Trump Administration’s ultimate motivation behind proposing the ESG rule, the world’s top asset managers say that sustainable investment is material to financial performance, especially in long-term plans. The proposal as-is will limit options for retirement plans and potentially increase costs for fiduciaries that could be passed on to the savers, the financial industry says.

    By Tsvetana Paraskova for Oilprice.com 

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      Why Canada Continues to Attract Real Estate Investors

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      Real estate experts, foreign investors, and Canada’s citizens unanimously agree that Canada has everything it takes to create better living opportunities and, therefore, become one of the most sought-after destinations globally. Besides, real estate in Canada is competitively priced, vast, and has a reasonable appreciation rate. The hassle-free legal system in Canada is another reason why foreign investors flock to Canada. A comparative study of real estate in the UK, US, Spain, or France will help you realize that Canadian real estate is not very expensive. You will find cheaper land in Canada and a myriad of real estate options to invest in.

       

      As the Canadian economy strengthens, more people are expected to migrate to this country, leading to a rise in demand for properties. According to real estate experts, this growing demand will boost the property values radically in years to come. In contrast to the high standard of living, Canada’s cost is lower than in many other countries. In Canada, foreign investors can buy cold properties that they probably couldn’t have afforded in their own countries. The most significant advantage is that you don’t have to be a resident of Canada to purchase property in the country. This puts foreign investors in an enviable position to invest in a higher quality purchase in Canada than their homelands. Owing to the abundant land available, overcrowding will never be an issue in this incredibly beautiful country. Besides, Canada has a diverse property portfolio that can please even the most fastidious buyer.

      The best part of being a foreign investor is that you virtually get to enjoy almost all the privileges and benefits as any other citizen and yet, not go through the painful ordeal of applying for immigration acceptance. Thus, as a foreign investor, you can open a bank account in the country and have your land and car. Alternatively, you can make Canada your new home by permanently settling in this country like millions of Europeans who have already decided here. This explains why Canada is the third most popular emigration destination. The ever-increasing popularity of Canada will continue to attract more people in the future. This popularity of Canada among expatriates ensures a steady supply of money in the property market.

      A quick look at the figures mentioned below will throw light on the Canadian property market’s past performance. Listed below are the rising prices of a single-family home in Vancouver:

       

      • 1961 – CAD $13,500

       

      • 1974 – CAD $48,000

       

      • 1982 – CAD $120,000

       

      • 2007 – CAD $475,000

       

      Canada provides excellent rental opportunities for real estate investors. Thus, if you purchase apartments and townhouses in some of the hottest areas in Canada, you can enjoy a steady income and cash flow in the form of rent. This allows you to enjoy capital appreciation and build equity in the long run. No matter what the reason may be for your investment, Canada has an effortless buying procedure, and you can close a property deal in a short time.

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      Rogers sweetens offer for Cogeco with $3B Quebec investment pledge – BNN

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      Rogers Communications Inc. said Friday it will invest up to $3 billion in Quebec if the telecom giant is successful in acquiring rival Cogeco’s Canadian assets. 

      The Toronto-based company unveiled a series of measures aimed at sweetening a deal to buy Cogeco’s internet and cable television business after getting rebuffed by the company’s largest shareholder earlier this month. 

      Rogers and Altice USA Inc. delivered an unsolicited proposal to buy Cogeco, with the U.S. company offering $10.3 billion for the company and would then sell the Canadian assets to Rogers for a cash consideration of $3.4 billion.

      “Rogers is deeply committed to the future of innovation and the knowledge economy in Quebec. We would be honoured to help enhance the customer experience and bring new investments including 5G that will fundamentally reshape the economic landscape of Quebec,” said Joe Natale, Rogers’ president and chief executive officer, in a statement.

      Rogers said it would spend $3 billion in Quebec, where Cogeco is based, over the next five years. Half of that investment would be earmarked for various network investments including a broad rollout of 5G wireless technology infrastructure as well as expanding connectivity to rural communities. Rogers added it would ensure that the combined company would employ 5,000 people while keeping Cogeco’s headquarters and management in the province, and would support several community partnerships.

      A Cogeco spokesperson told BNN Bloomberg in an email that Rogers is free to make its investment in Quebec, but it doesn’t need to buy Cogeco to do so. 

      “If Rogers fails to invest, their competitors will take away its mobile customers, regardless of 5G,” the spokesperson said. “As far as Cogeco is concerned, the company remains focused on executing its profitable growth strategy, investing in its state of the art broadband networks and offering leading edge services to its customers.”  

      Earlier this month, Cogeco’s independent directors rejected Rogers and Altice’s takeover offer, with Gestion Audem, Cogeco’s controlling shareholder and the Audet family’s investment vehicle, stating that it is not interested in selling its shares.

      Analysts have also cast doubt on whether a deal could ever materialize given the Audet family’s control of the business. 

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      Want to invest like Warren Buffett? Now you can with the Buffettology Smaller Companies Investment Trust

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      Is Warren Buffett headed to the UK? Well, more in spirit than in body.

      For the 90-year-old Sage of Omaha’s investment philosophy that turned him into one of the world’s most successful stock-pickers will be at the heart of a trust that also takes his name.

      The Buffettology Smaller Companies Investment Trust is aiming to raise at least £100mln, which it will plough into some of the market’s hidden gems.

      It is the brainchild of Sanford DeLand, the boutique asset manager behind the top-performing SDL UK Buffettology fund inspired by billionaire head of Berkshire Hathaway.

      The listed vehicle will be run by Keith Ashworth-Lord, the driving force behind the highly-rated, £1.4bn SDL UK Buffettology fund. Over the last three years, it has delivered a 30% return and is ranked second out of more than 200 similar funds for its five-year performance.

      Its top holding is Games Workshop, which accounts for just under 10% of the portfolio.

      In a statement on the launch of the listing of the new trust, chief investment officer Ashworth-Lord said: “We believe that the UK small-cap market offers excellent investment opportunities to experienced managers who know what to look for and have the freedom to take a long-term view.

      “Our business perspective investing approach is ripe for application to smaller companies and presents an opportunity to deliver superior returns for our shareholders, over the long-term.”

      Buffettology will be quoted on the premium segment of the official list. The prospectus is expected to be published on or around September 29.

      Source:- Proactive Investors USA &amp; Canada

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