Yesterday marked the 50th Earth Day, an annual event celebrated by countries around the world to show support for environmental protections. To environment-minded business leaders, Earth Day is often an opportunity to distinguish themselves from competitors by demonstrating the work they’ve done for social good… aside from plowing profits.
On Monday, Wall Street’s largest investment bank, Goldman Sachs, released its 2018 sustainability report, an annual summary of the bank’s progress in ESG (environmental, social and governance) investing, green operations, staff diversity and other non-financial performance categories.
Goldman reported that it had invested $17 billion in ESG and impact investing assets at the end of 2018, up from $11.3 billion a year earlier and $3.8 billion in 2015.
The increase in 2018 was driven by the launch of an ESG-focused exchange traded fund (ETF) that provides clients with broad exposure to U.S. large cap companies. That was a major step for the ESG category, which had historically been accessible to only institutional investors and tailored to niche interests (such as fossil fuel-free).
“We view sustainability as core to our mission, and will continue to innovate on behalf of clients, shareholders and the communities where we live and work,” Goldman’s senior executive team, led by CEO David Solomon, wrote in the introduction to the sustainability report.
Aside from client strategies, Goldman Sachs has also pledged to reduce the carbon footprint of its own corporate operations. On that front, though, progress seems to be slow and challenging.
In 2018, the bank dedicated $1.2 billion to green buildings and green technologies. While that spending accounted for 60 percent of the total budget goal ($2 billion) in the green investments category by 2020, the bank only managed to improve its energy efficiency by 10 percent based on 2015 levels, a two-percent step back from the year before.