Wealth Managers need to have “values-based” options: Crestone


  • Wealth Managers provide investment services for high net worth individuals, family offices, and not-for-profits
  • Crestone Wealth Management says that wealth managers need to have options for clients that allow them to align their values to their investments
  • CIO Scott Haslem says better data and better tools makes this possible


Wealth managers will “increasingly need to be able to offer” values-based investment options, according to the chief investment officer of Crestone Wealth Management.

Crestone Wealth Management provides wealth advice and portfolio management services. Chief Investment Officer Scott Haslem recently spoke with Audacious Investing about the increased push from clients for portfolios that apply responsible investment techniques.

“Wealth managers are going to be required to meet the needs of a growing group of investors – millennials – who increasingly want to align their investments with their values, whether they’re ethical or political,” Scott says. “As investment professionals walk this path, it’s clear that the challenge of moving a portfolio onto a responsible footing is no longer as great as it used to be. It’s no longer focused on negatively screening out particular companies, but gradually, through time, shifting your portfolio to more responsible footing.”

As long-term research suggests that responsible investment portfolios can outperform wider benchmarks over longer term time horizons, clients are increasingly interested in how strategies such as negative screening, positive screening and environmental, social and governance (ESG) integration can be used to manage their portfolios, Scott says.

“The tools available are greater than they were in the past,” Scott says. “When confronted in the past with a desire to move your portfolio to a more responsible footing, you may have had to give up return or diversification…this is no longer the case. Indeed, academic research shows that responsible portfolios perform as well as other portfolios, and in some cases are actually outperforming. In the more recent period, there have been a number of corporate controversies where had you screened out say, VW or Wells Fargo for ESG factors, this would have had a positive impact on your portfolio.”

Crestone is a high net worth wealth manager that works with high-net-worth clients and family offices, not-for-profit organisations, and financial institutions Scott says.

“We can offer them a broad spectrum of investment opportunities across the ESG space to enable them to either move in one step, or more likely over time, shift their portfolio onto a more responsible footing,” Scott says. “We can either substitute particular allocations in Australian equities into a more responsible Australian equity funds, or for those investors who hold direct shares, we can assess the ESG factors of those shares and move to best in class.”

There is more information available on corporate behaviour, which means that investment analysts can now assess a range of data on environmental, social and governance performance. Additionally, research companies offer screening tools in order to assess how responsible a portfolio is, which can aid in the process of developing a values-aligned portfolio.

“Also, I would say, there has been such a growth in investment funds that incorporate ESG factors, the availability of diversification options, not just in equities, not just in advanced economies, but fixed income as well as credit, there’s just a whole lot more visibility on these factors,” Scott says. “The other thing that is worth noting as well is that given the challenges that the globe faces in sustainability, companies are seeking to do things more efficiently and in ways that uses resources less. That drive for efficiency and productivity often lifts their financial performance as well.”