2023 End of Year Letter From Veris CIO Michael Lent

By Michael Lent, Co-founder and CIO of Veris Wealth Partners 

This letter was originally published as part of Veris’ 2023 Impact Report.

I write this at a time of great turbulence in the world. We are seeing acts of violence and warfare, extreme partisanship and political turmoil, and a barrage of attacks on ESG investing and DEI practices. 

It can sometimes be hard to feel hopeful in this period, but I still believe that progress is being made and that impact investors are making meaningful contributions towards solving social and environmental challenges.  

Despite the turbulence, the US economy has been doing fairly well,¹ workers have been gaining at the bargaining table,² and the energy transition is moving forward³ (albeit at a slower pace than we would like to see). 

Silver Linings 

In my view, the attacks on ESG and DEI present an opportunity for us to determine who in the investment field is authentically committed to these issues and who is not. For example, some mutual funds and ETFs have stopped marketing themselves as ESG or Sustainable because they were not truly committed to an authentic process and instead were greenwashing.⁴ 

The SEC recently adopted the Names Rule which requires funds that use ESG in the name invest at least 80% of the value of its assets in alignment with ESG factors.⁵ It appears that some asset managers and investors do not want to stand up to the scrutiny of the Republican AGs and House committees and have stopped using ESG or DEI in fund names even if they continue to offer investment options in this area.  

However, those funds and managers that are committed to ESG and DEI are staying the course and continuing to innovate, deepen their analysis, and move our field forward.⁶    

Challenges We Are Facing on the Route to a Decarbonized Economy

It is important to recognize that it has been a difficult market environment for ESG and Impact Investors as well. The traditional energy sector (oil and gas), which is one of the largest contributors to climate change, has been one of the best performing areas of the public equity markets over the past three years due to the Russian invasion of Ukraine, OPEC+ supply constraints coming from Saudi Arabia and Russia, and the emerging Middle East Conflict.⁷  

Renewable energy stocks have underperformed during the same time due to their high capital requirements, higher borrowing costs, and increased cost of inputs.⁸ ⁹

This has had an impact on portfolios that are fossil fuel free and low carbon. Some environmental thematic equity managers and funds have had some short-term underperformance. However, we see this as a short-term phenomenon. Over the past ten years traditional energy stocks have been the worst performing sector of the market. 

S&P 500 GICS Sectors Annualized 10-year Risk/Return. Source: Morningstar 2023

The US Inflation Reduction Act, the Chinese commitment to significant investment in solar power and Electric Vehicles, the need for Europe to become less dependent on natural gas and the innovations in energy efficiency and other low carbon options will likely provide a tailwind over the medium term. 

We think the current challenge is bringing together the desire to decarbonize the economy with a just transition that addresses frontline community needs and the need for POC and labor to participate in the economy of the future. Our report highlights our Just Transition Investment Framework and two investment examples. We are committed to identifying more options in the next several years as we see this as one of the most important contributions impact investors can make. 

Progress Towards Our Firm’s Equity, Diversity, and Inclusion Goals

Veris has made a commitment to continue to bring EDI managers on our platform and work with our current managers to encourage progress in this area. See our firm’s report on Investing in Diversity, Equity, Inclusion, and Belonging for more information about our approach. 

Despite the attacks on DEI, we have been able to identify new opportunities for investing with DEI managers: both diverse teams and those using a DEI investing lens.

We have brought to our platform several excellent EDI managers, some of whom are first-time fund managers. Investing in first-time EDI managers is critical to ensure that the field becomes more diverse in the future. As we have outlined in this report our engagements with our approved managers have resulted in better EDI-specific data collection and we are seeing improvement in the diversity of metrics and disclosures. While these improvements are important, we are committed to making further progress to meet our goals.

Our Work Continues 

Since the very beginning of our firm’s history, Veris has had a vision to build a more just, equitable, and sustainable world through our investments and our practices. The challenges the world is facing require bold and innovative approaches. We are not daunted by the most recent challenges and see that they create new opportunities. 

I thank our Managing Director of Investments, Roraj Pradhananga and his Investments Team for the excellent work they are doing in advancing our impact investing research and continuing to innovate to achieve our vision.

Michael Lent

Chief Investment Officer and Founding Partner

Veris’ 2023 Impact Report is available for download here

Veris Wealth Partners annual impact report for 2023. Featuring highlights of the social and environmental impact of our clients' investments and shareholder activism. Also features the debut of our Climate Justice Investing Framework.


1 https://www.bea.gov/news/2023/gross-domestic-product-third-quarter-2023-advance-estimate

2 https://www.bloomberg.com/news/articles/2023-10-28/uaw-aims-to-announce-stellantis-deal-saturday-as-talks-finish-up

3 https://www.bloomberg.com/news/articles/2023-01-26/global-clean-energy-investments-match-fossil-fuel-for-first-time

4 https://www.morningstar.com/sustainable-investing/sec-targets-greenwashing-with-dws-investments-settlement-names-rule

5 https://www.morningstar.com/sustainable-investing/sec-targets-greenwashing-with-dws-investments-settlement-names-rule

6 www.institutionalinvestor.com/article/2cdc8zv066plxdq1p83cw/culture/how-the-fearless-fund-lawsuit-is-provoking-outrage-new-dei-strategies-and-renewed-commitment

7 https://www.bloomberg.com/news/articles/2023-10-20/energy-stocks-keep-rising-after-middle-east-tensions-widen

8 https://www.ctvc.co/spooky-season-for-clean-energy-stocks-171/

9 https://www.bloomberg.com/news/articles/2023-10-20/a-5-bond-yield-means-280-billion-green-stocks-rout-will-worsen

This content is intended for informational purposes only, provides only a summary of topics discussed, does not constitute personalized investment advice or recommendations, and solely reflects the opinions of Veris Wealth Partners (“Veris”), which are subject to change without notice. The information contained in this document contains certain forward-looking statements, often characterized by words such as “believes,” “anticipates,” “plans,” “expects,” “projects,” and other similar words, that indicate future possibilities. Due to known and unknown risks, other uncertainties and factors, actual results may differ materially from the expectations portrayed in such forward-looking statements.

Certain information contained herein is derived from third party sources. While Veris believes such information to be accurate, we have not independently verified the accuracy or completeness of such information.

2022 Impact Report

Veris Celebrates 15 Years of Impact in our 2022 Impact Report

In this season of thanks, we are grateful to be celebrating our firm’s 15th Anniversary with the release of our 2022 Impact Report.

In this year’s Impact Report, we illustrate the positive social and environmental progress we have helped create, thanks to our wonderful clients, team, investment managers and industry partners.

Download Report
2022 Impact Report

As our CEO Stephanie Cohn Rupp writes, “Through a great recession, volatile markets, a global pandemic, and attacks against our sector steeped in deep misunderstanding, Veris has grown. We owe this to our wonderful clients who believe finance can be a force for justice and sustainability, to our talented team, and to our founders – whom I thank for making such a powerful dream a reality.”

This Impact Report also offers highlights from our history as one of the oldest independent wealth management firms with a 100% focus on authentic ESG and impact investing, our work in shareholder activism, efforts to dismantle obstacles to diversity, equity, inclusion, and belonging within Veris and across the industry, and much much more. We hope you enjoy it and we welcome your thoughts.

From all of us at Veris, we wish you a very Happy Thanksgiving!

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Download 2022 Impact Report
Veris 2018 Impact Report

Read Our Latest Impact Report

By Anders Ferguson and Casey Verbeck

We hope you will take a few minutes to read our just-published 2018 Impact Report.

Download the 2018 Impact Report

Our Impact Report is the latest in a series of annual updates summarizing key developments around the world. The report is also an affirmation that the impact investing community is making good on its value proposition: To deliver market performance and positive social and environmental impact.

To our delight, the report reflects the passion and energy of our clients and the team at Veris. Each day, we’re emboldened and inspired by all of our clients, which in turn, motivates the team to reach higher and explore new ideas and solutions.

Many Highlights
This comprehensive, 28-page report offers insight about important developments in the field over the past year, including the following:

• A strategic assessment of where impact investing is headed
• Four macro trends that gained momentum in the past year
• Veris’s accomplishments in advancing impact investing
• A retrospective about transformative business over the past 50 years
• A scorecard quantifying the results of impact investing worldwide
• The positive impact of active ownership of public companies
• A snapshot of Veris’s five key investment themes
• An overview of our commitment to diversity and reducing our carbon footprint

This year’s report is the product of many hands starting with the partners of Veris, whose support for this annual project has been essential to its success.

Special recognition goes to our Research Group, whose analysis is another reason Veris is a recognized thought leader in the field. A heartfelt thanks goes to the team that did all of the hands-on hard work – Jessica Lowry, Nicole Davis, Garrett Markley, Luke Seidl, Richard Chen, Chris Baldwin, Greg Berardi, Susan Nagy, and Brian Kay. Together, this terrific team has produced another terrific report. Click here to download the report.

Anders Ferguson and Casey Verbeck are partners at Veris Wealth Partners.