ForUsAll is on a mission — to improve the financial future for you, your employees, and for us all. Now, with the introduction of five new investment funds, your employees can help improve the future for our environment, as they invest for their future retirement. And you can offer a valuable retirement benefit to employees that provides an exemption from the CalSavers law. Read more about what the CalSavers law means for you.
These new low-cost, diversified investment funds are available to your employees through the modern 401(k) plan offered by ForUsAll. Read more about the benefits of a modern 401(k) for employers and employees. Similar to typical investment funds that hold stocks and bonds, these funds go a step further by considering a company’s track record on environmental, social and governance issues, or ESG. That might include a company’s impact on clean water, its workforce policies, or how it handles data security.
Why ESG and why now?
Investing with ESG funds isn’t new, but the time is right for bringing them into a retirement plan.
The numbers speak for themselves: Investors used to think they had to choose between funds for investment returns or for sustainability — now we know it’s possible to have both (1). Many ESG funds have generated higher returns with lower levels of volatility1. How so? Companies with a bad ESG reputation can have higher costs (operational and legal) and a tarnished brand. And as ESG funds become more popular, demand for stock in companies with poor ESG ratings can go down. Looking back at March 2020, when the stock market dropped dramatically, ESG funds helped protect investors from losses (2). The message is clear: even if you don’t believe in climate change or care which companies are the biggest offenders, it’s important to know that the stock market does.
More investors want more access: Survey after survey shows us that most people are interested in ESG funds (3). And investor actions speak even louder than words. For example, as many people sold shares in mutual funds during 2020, ESG and other sustainably managed funds in the US went up by more than $50 billion. That’s on top of an increase of more than $20 billion in 2019. Strong interest in these funds may also help to motivate people toward higher retirement savings rates. Without ESG fund options, employees who feel strongly about the environment or social issues are not only shut out from investing in line with their values but are also deprived of the funds’ potentially better performance.
ESG and other sustainably managed funds in the US went up by more than $50 billion.
It’s the future of investing: ForUsAll believes that strong interest in ESG funds and strong historical performance will continue to build. We see a future in which bad business practices lead to higher expenses and lower profits, compelling companies to improve their ESG actions. We also expect investors to increasingly move money to more sustainable companies. And as founders of a business that invests for the future, we believe that investing in an environmentally responsible way is the financially responsible thing to do.
A modern retirement plan needs modern investment options
We are at the beginning of this ESG journey, with our own workforce, the companies we serve, and the tens of thousands of people they employ. As an advisor, we are committed to helping people create wealth with more resilient portfolios. Adding these new options is just one step in this journey and a continuation of our mission to build a brighter financial future for us all.
(1)"Sustainable Equity Funds Outperform Traditional Peers in 2020,” Morningstar, January 8, 2021
(2)“Sustainable Funds Weather the First Quarter Better than Conventional Funds” Morningstar, April 3, 2020.
(3)“The True Faces of Sustainable Investing: Busting Industry Myths Around ESG”, Morningstar, April 2019.