Obermatt Criteria for Socially Responsible Investments
Are Corporate Governance, family and environmental friendliness or sound financial incentives important to you? This is generally known as Corporate Socially Responsible Investments or SRI / ethical investing.
Obermatt has introduced the Focus Markets for this purpose: Focus Markets help you find stocks meet climate, social and other SRI aspects better than others.
An Obermatt Focus Market is a group of stocks that meet its focus criteria:
Inclusion Criteria
Inclusion criteria are those criteria that are typically desired and should be present in the stocks
| Inclusion criteria | Description |
|---|---|
| Family Friendly | Corporations that support families with family friendly policies for their employees |
| Climate Friendly | Corporations that fight climate change with carbon reduction policies and products |
| Good Governance | Corporations with good governance structures |
| Independent Board | Corporations with an independent board governance structure |
| Sound Incentives | Corporations with sound executive pay policies that go beyond stock returns and profits |
| Renewable Energy | Corporations that focus on renewable energy |
| Inclusive Leadership | Corporations with an inclusive leadership |
| Employee Friendly | Corporations with employee friendly practices |
| Trusted Countries | Corporations headquartered in trusted societies with human rights and business friendly cultures |
Exclusion Criteria
Exclusion criteria are those criteria that are typically undesirable and must not be present in the stocks:
| Exclusion Criteria | Description |
|---|---|
| No Gambling | Exclude companies with gambling activities |
| No Tobacco | Exclude companies with tobacco products |
| No Controversies | Exclude companies with controversial topics in the media |
| No Obisity | Exclude companies with products causing obesity |
| No Alcohol | Exclude companies with alcohol products |
| No Predatory Finance | Exclude companies in predatory finance such as consumer credit |
| No Nuclear | Exclude nuclear power companies |
| No Fossils | Exclude fossil fuel companies |
| No Animal Testing | Exclude companies that practice animal testing |
| No Agrochemical | Exclude companies with agrochemical products |
| No Hazardous Waste | Exclude companies that create signficiant hazardous waste |
| No Armaments | Exclude companies producing armaments |
| No GMO | Exclude companies that genetically modify organisms |
Find stocks with Focus Criteria
Inclusion and exclusion criteria are available in the stock filter. A selection of these criteria is summarized in focus markets for which top 10 lists are regularly compiled.
Good Governance Stocks
Obermatt collaborates with leading corporate governance rating agencies to identify stocks with a good corporate governance. It is these governance agencies that define the stocks with sufficient corporate governance characteristics for the Obermatt stock analysis. Obermatt then takes these lists of good governance stocks and analyzes them for value, growth, and safety to publish the Top 10 Governance Stocks. There is more on the subject "good governance" and a list of all Obermatt Good Governance Focus Markets in the Obermatt Stock Focus Corporate Governance Home Page.
Climate Friendly Stocks
Obermatt works with leading CO2 research agencies to identify the stocks that are better in climate friendly than others. These climate research agencies use company reporting to measure the CO2 footprint (the total amount of CO2 emissions) of a company. Obermatt then compares this amount to the total amount of revenue (sales in USD, Euro or Swiss Francs for example) and groups them by industry so that only stocks of the same industry are compared against each other. By calculating the CO2 footprint per sales, Obermatt identifies those companies that have relatively small CO2 emissions in their industry. All below median CO2 footprint stocks are included in the Stock Focus Climate Friendly and in its Top 10 Climate Friendly Stocks. There is more on the subject "climate friendly" and a list of all Obermatt Climate Friendly Focus Markets in the Obermatt Stock Focus Climate Friendly Home Page.
Family Friendly Stocks
Obermatt uses stock lists from family and women-oriented non-government organization such as the Women's Empowerment Principles organization. These organizations define the criteria to identify stocks that are women and thus family-friendly. Obermatt uses these long-lists of family friendly stocks and analyzes them for value, growth, and safety to publish the Top 10 Family Friendly Stocks. There is more on the subject "family friendly" and a list of all Obermatt Family Friendly Focus Markets in the Obermatt Stock Focus Family Friendly Stocks Home Page.
Stocks with Sound Incentives
Obermatt selects sound incentives stocks based on the stock's business model and its corporate governance characteristics. Excluded are companies in the airline industry, the pharmaceutical industry, and life-insurance companies as well as all partner-run companies such as consultancies, investment banks, and private equity groups. We believe that these companies are better run as partnerships, co-operatives, and associations. We also exclude companies where there is a clear misalignment of financial management incentives such as excessively high executive compensation and highly leveraged compensation schemes such as stock option plans. In addition, the Obermatt stock focus Sound Incentives contains only stocks in the X-Large and XX-Large size categories so that the Top 10 Sound Incentives Stocks are a good place to look for long-term investment ideas when saving for retirement. There is more on the subject "Sound Incentives" and a list of all Obermatt Sound Incentives Focus Markets in the Obermatt Stock Focus Sound Incentives Home Page.