Seneca’s CEO picks three green stocks to keep high on your watchlist

Luke Laretive

CEO & Investment Advisor

What’s hot right now?

Laretive sees great potential in companies focused on green, socially responsible enterprise.

“As a society and as humanity we tend to focus our efforts, innovation, and money in the areas where the returns are potentially the highest,” he said.

“But I suppose the difference now is that investors are interested first in the ethics and then the financial return and that has been a shift over the last five or so years.

“It is something we have seen across the client base for a number of years, but it has only really hit the mainstream in the last 18 months.”

He said that impact investing – where investments are made into companies and organisations with the intention to generate a measurable social or environmental impact alongside a financial return – is driving down the cost of capital for companies in this space.

“MSCI, a global indexing business based out of New York, has calculated that the current differential between first quintile ESG-scoring companies and fifth quantile ESG companies is 39 basis points.

“This demonstrates that companies with high ESG scores are creating sustainable, competitive advantage, particularly for those companies with high upfront capex requirements – such as in the mining or infrastructure sectors where much of the energy sector is.”

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