Ellevest

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Discover Your Assets’ Impact With the Ellevest Portfolio Health Check

By Emily Green

The data doesn’t lie: Impact investing —  investing in assets capable of driving measurable environmental and social change — is on the rise. 85% of people have expressed interest in impact investing, and 79% of women say they want to invest for positive impact. In the past two years alone, more than $1 trillion has been invested in ESG funds.

A pie chart on the left. On the right, text that says “Current portfolio: Flagged” and “Proposed portfolio: Clean.”

In fact, we all make decisions every day that align with our personal values, about how we choose to spend our time and energy: You may patronize the small businesses in your neighborhood, or leave work a little early to make your child’s soccer game. In this era, it makes sense that investing according to those values — a deeply personal issue — is starting to matter more than ever. 

But there’s a big difference between wanting to and knowing how best to start investing to make an impact. If you’re looking to align your investments with your values, there are plenty of unknowns that can complicate the process; a surge in greenwashing, for example, has made it harder to understand whether an investment is truly good for the planet. Plus, it’s harder to know whether any given impact investment opportunity will still perform as competitively as its traditional counterparts.

The undertaking can be especially fraught for women. As investors, we’re told what to do by existing organizations and funds that have been operating according to generations-old investment “best practices” and “rules of thumb.” So we may proceed with the best intentions, not knowing whether the organizations that our investments support are working against the changes we want to see in the world, nor whether we can (or should) dive deeper.

Money is power, but so is information. Understanding where your money is going — and what it is or isn’t supporting — is a rare, actionable step that can help create the world we want to live in. Data is a key component in getting started with impact investing: You need to be able to see how your portfolio performs today in order to know where you want it to go next.

That’s why the Ellevest Portfolio Health Check is a key component of the Ellevest Private Wealth experience. It’s a diagnostic of an investor’s current equity holdings that provides you with a detailed view of where and in what specific ways those holdings may be working against your values and a detailed recommendation of where you might be able to realign them — without sacrificing returns.

How the Ellevest Portfolio Health Check works 

When you speak with and share your existing equity portfolio holdings with an Ellevest Private Wealth Management advisor, we’ll give you a detailed analysis of your investments’ current impact. While there’s no way to know every detail of every single asset, we use a data-driven, holistic approach that enables us to examine issues beyond how many women a company has on its board. The Ellevest Portfolio Health Check is informed by a set of data and sources that we use to assess an asset’s impact in areas like:

  • climate change, which we know disproportionately affects women globally

  • data privacy, a key concern, particularly since the overturning of Roe v. Wade

  • human rights violations, which studies show harm women most of all

An example visual from an Ellevest Portfolio Health Check. It shows the results for a hypothetical example portfolio where 38.26% of holdings were flagged, and 61.74% of holdings were clean.

You’ll receive a diagnostic that breaks down your current holdings and flags those that don’t meet our impact criteria. This will include an overview of your individual holdings — including those included in index and mutual funds — and be broken down according to category (like the ones above). You’ll be able to see your ratio of “clean” and “flagged” holdings, along with your top ten most-flagged assets and the reasons they’re “flagged.”

Once you have that breakdown, your private wealth advisor will work with you to model a new “clean” portfolio that can match the impact you want to make — while still seeking competitive returns.

An example visual from an Ellevest Portfolio Health Check. It shows the portfolio details for a proposed clean portfolio using Ellevest’s impact investing strategy.

This information allows you to take control of your money beyond just using financial data. Think of the Ellevest Portfolio Health Check as a tool — the first step toward a competitive portfolio that reflects who you are, what you believe in, and what kind of better world you want to see.

The data that powers the Ellevest Portfolio Health Check

An example visual from an Ellevest Portfolio Health Check. Various factors, like firearms and fossil fuels, are listed along the left, and each of them points back at icons for both women’s rights and racial justice.

The Portfolio Health Check is powered by our ongoing relationship with Ethic, a company that uses data to create socially responsible solutions for the financial industry. As two mission-aligned organizations, we came together to create Ellevest’s Intentional Impact Strategy to address two deeply interconnected issues: women’s rights and racial justice. Using a data- and research-driven approach to investment, these Intentional Impact Strategies look beyond surface-level quotas to help our clients transition money away from companies whose practices don’t align with their values — and toward companies that can actually make the change they want to see. 

Even better, neither Ellevest nor Ethic stops with the data we have. When honing our approach, we also seek out what we don’t know, by talking to experts on the issues and factoring in those perspectives and new information that the finance industry may be lacking or overlooking. We’re proud of what we built together: an industry-leading impact investing experience for our clients.

Impact investing is the smart financial move, too

Let’s zoom out for a moment. Climate change is expected to cost the global economy $178 trillion over the next 50 years. And when companies are hostile toward women — and those women exit the workforce — it costs the US economy over $650 billion every year. Investing responsibly — for the long term — matters both from an impact perspective and from a financial perspective. 

Our data puts us at the forefront of this shift, by allowing us to divest from companies that ignore these catalytic issues and invest in forward-thinking companies that are planning for things like environmental and social issues. 

This is not an issue for future generations — this is an issue for now. Let us use our expertise as the only investment company built by women, for women — with deeply sourced data partners — to build you one of the most innovative and thoughtful portfolios focused on women. To learn more about health checks, you can see a sample health check here, or speak with an Ellevest advisor today.

Disclosures

© 2022 Ellevest, Inc. All Rights Reserved.

Minimum $1 million in investable assets ($250,000 in equities) to qualify for a portfolio diagnostic.

Information was obtained from third-party sources, which we believe to be reliable but not guaranteed for accuracy or completeness.

The information provided should not be relied upon as investment advice or recommendations, does not constitute a solicitation to buy or sell securities and should not be considered specific legal, investment or tax advice.

The information provided does not take into account the specific objectives, financial situation or particular needs of any specific person.

Investing entails risk, including the possible loss of principal, and there is no assurance that the investment will provide positive performance over any period of time.

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Emily Green

Emily joined Ellevest after seven years with JP Morgan, where she focused on the needs of high-net-worth families. Today, she’s a financial advisor on Ellevest’s Private Wealth Management team, working with clients to help them develop personalized long-term investment plans that align with their goals and values.