Balance performance potential with principles, through ESG investing.

As demand continues to increase, it is clear that sustainable investing isnʼt a passing fad. Neither are we. Our years of experience, expertise, and insights can help investors balance their personal values with investment value. 

        

What Is ESG Investing?

ESG investing broadly refers to the incorporation of environmental, social and governance factors alongside traditional financial analysis. Depending on the nature of the strategy, one or more approaches can be used within the investment process to bring ESG values into a portfolio.

ESG Solutions by New York Life Investments
ESG Solutions by New York Life Investments

          

Approaches to ESG Investing

esg integration

ESG Integration

This approach, also referred to as ESG consideration, is defined as investing that considers or integrates ESG factors into the investment approach, alongside traditional financial factors. As of June 2021, 58% of our MainStay mutual funds (25 out of 43) integrate ESG as part of the investment process.

          

Sustainable Investing

This approach makes ESG analysis a significant aspect of a strategy’s investment thesis in order to respond to investors’ values while seeking financial returns. Within sustainable investing, there are three common nonexclusive approaches:

  • Exclusionary Investing
    Also called negative selection or negative screening, is an investing approach that excludes companies or sectors that do not meet certain sustainability criteria. This approach is commonly used for investors who want to ensure their investments don’t support companies that act against their values.
     
  • Inclusionary Investing
    Also called positive selection or positive screening, is an investing approach that seeks positive ESG outcomes by selecting companies based upon their ESG profiles. This approach is commonly used for investors who want to evaluate ESG risks and opportunities when selecting a company or issuer to invest in.
     
  • Impact Investing
    Is an investing approach that attempts to deliver measurable social and/or environmental impact. This approach is commonly used for investors who want to invest in companies and issuers that are creating a positive change.
     

          

Stewardship Activities

ESG incorporation generally functions alongside - or in combination with - stewardship or active ownership. Stewardship includes proxy voting and engagement with companies in dialogue and can be conducted across all portfolios. Stewardship is defined as the use of influence by investors and can be implemented through a use of tools including, but not limited to, engagement with issuers, voting at shareholder meetings, and direct roles on investee boards and board committees supporting stewardship goals.

          

The Benefits of ESG Investing

Focusing on companies or issuers that better manage ESG risks may help avoid underperformers within sectors, potentially leading to better risk-adjusted returns over the long term. To gain a better understanding as to what approaches our sustainable investing strategies use, please refer to the table below—which is subject to change. All investment solutions listed below incorporate ESG into their investment decision-making process in combination with the sustainable investing approaches that are outlined. Please note that other asset managers/investors may categorize their products differently than what is displayed below. 

Our Spectrum of Sustainable Investing Solutions

The SMA products listed are not available to all clients in all jurisdictions or regions where such product would be contrary to local laws or regulations.

          

Featured Resources

turbines

Welcome to the Candriam Academy
(CE Approved)

Join Candriam Academy, the world’s first free-to-access accredited training platform for ESG investing.

Hiding Lobelia

ESG Talks: Educational, Conversational and 1 CE per Video

Candriam Academy’s ESG Talks video series focuses on today’s most pressing economic, social and environmental issues.

   

Additional ESG Investing Solutions

Performance data quoted represents past performance. Past performance is no guarantee of future results. Due to market volatility, current performance may be less or higher than the figures shown. Investment return and principal value will fluctuate so that upon redemption, shares may be worth more or less than their original cost. Performance figures for all Funds reflect contractual waivers and/or expense limitations, without which total returns may have been lower. These limitations may be modified or terminated only with Board approval.


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 (this does not include the effects of sales charges, loads, and redemption fees). The top 10% of products in each product category receive 5stars, 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 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.


Click on the product name for the most recent overall risk-adjusted Morningstar ratings shown above, including ratings by share class and time period and the number of funds in each category. The Fund page also includes the prospectus, investment objectives, performance, risk and other important information.

Our Commitment to ESG

As a signatory of the United Nations Principles for Responsible Investing (UN PRI), we are committed to the 6 Principles for Responsible Investing. Read more about our commitments below.

 

Environmental, Social and Governance (ESG) managers may take into consideration factors beyond traditional financial information to select securities, which could result in relative investment performance deviating from other strategies or broad market benchmarks, depending on whether such sectors or investments are in or out of favor in the market.  Further, ESG strategies may rely on certain values-based criteria to eliminate exposures found in similar strategies or broad market benchmarks, which could also result in relative investment performance deviating.