Among charities, the question of how capital should “behave” has evolved. Beyond generating returns and supporting financial stability, many trustees now wonder whether an investment portfolio can quietly advance the same social progress the charity works for every day. Increasingly, the answer appears to be yes, not through grand gestures, but through the steady influence of thoughtful investment decisions.
LGT aim to create real social impact as a business which comes from the organisation’s own actions, such as how it operates, the products it delivers, and the way it treats people such as clients and staff. By contrast, achieving social impact through investments is about using capital to support and influence companies that are contributing to positive change. Instead of delivering impact directly, investors direct funding toward businesses with strong environmental or social momentum and encourage better practices through active stewardship. In short, businesses create impact through what they do; investors create impact through putting their funds in companies they trust to contribute meaningfully on their behalf.
In recent years, the investment landscape has broadened. Companies are more transparent about their environmental footprints, supply chains, workforce practices and community impact. Regulators have raised expectations. The availability and quality of sustainability-related data has improved in many areas, although coverage and consistency still vary. As a result, investors today can look not only at the numbers, but also at the direction of travel: whether a business is contributing to a healthier society or a more sustainable world.
Our approach at LGT reflects this shift. Rather than treating sustainability as an add on, it is woven through the investment process. Each company is assessed on financial fundamentals, of course, but also on how its products, operations and governance align with long term societal needs. Insights from the UN Sustainable Development Goals provide a useful compass, pointing toward themes such as inclusion, wellbeing, environmental action and responsible use of resources. This is not about perfection; rather, it is about progress, intention and real world effect.
For charities, whose missions often span decades and whose values sit at the centre of decision making, this way of investing feels natural. A portfolio can remain disciplined, diversified and return focused while also reflecting the organisation’s broader aims. And over time, the impact becomes visible, in sectors supported, risks avoided, and positive influence exerted on companies through active stewardship.
Case Study: NextEra Energy
LGT has engaged with NextEra Energy through the PRI Advance initiative since 2022, acting as co-lead investor to coordinate expectations and maintain a structured dialogue on human rights. This sustained engagement formed part of a broader investor dialogue that was followed by the publication of the company’s first standalone Human Rights Policy in Q4 2025, which marked a significant step forward in governance, oversight, and the articulation of standards for contractors and partners.
This progress reflects a strengthening of the company’s approach to managing human rights risks across its extensive renewable energy pipeline, where community relations, land use and permitting are critical. Investors have increasingly recognised NextEra’s approach to tribal engagement as relatively advanced, embedded across the entire project lifecycle, demonstrating meaningful integration of stakeholder considerations into operations. Overall, the engagement has contributed to greater transparency, more robust risk management and enhanced stakeholder trust which are essential enablers of responsible growth.
Case Study: Nestle
LGT is co-leading engagement with Nestlé under the Nature Action 100 initiative, focusing on strengthening biodiversity governance within a company whose supply chains are directly dependent on healthy ecosystems. Through collaborative investor dialogue, Nestlé has demonstrated strong baseline capabilities, particularly in supply chain transparency and traceability, and as a result is well-regarded by some investors.
Engagement has focused attention on closing remaining gaps, most notably the absence of a comprehensive public biodiversity assessment, now clearly identified as a priority next step. This structured and constructive engagement has already led to deeper engagement, improved investor access and clearer direction of travel, with Nestlé progressing towards enhanced disclosure of biodiversity and water-related risks, actions and targets. By building on existing strengths and pushing for greater transparency, with the aim of supporting more resilient supply chains and long-term value creation.
Financial Inclusion and Expanding Opportunity
In other parts of our portfolios, impact is delivered through financial inclusion. Several of our investments support institutions that provide lending to underserved households and small businesses. Even modest, responsible loans, can be transformative – enabling individuals to stabilise their income, grow a business, or access the tools needed for work.
For charities focused on poverty alleviation, social mobility or community development, financial inclusion investments offer a powerful complement to their mission. They allow portfolios to actively support these objectives without compromising financial quality.
At the heart of all of these examples is the role of stewardship. Shareholders today can encourage better corporate behaviour through voting, dialogue and collaboration with other investors. Whether the focus is biodiversity, climate strategy, workplace equity or responsible use of technology, can, in some cases, support long-term improvements. It is a subtle but meaningful way for investors including charities to help shape the corporate landscape.
For trustees, the comfort lies in the rigour: sustainability is not a separate filter applied after the fact, but part of the same disciplined process used to assess risk and return. This helps ensure that portfolios remain financially robust while also being better aligned with the future your charity hopes to build.
In the end, the idea that investments can deliver social impact is less about making a dramatic shift, and more about recognising the influence your capital already has and choosing to direct that influence with care. For charities, whose missions are rooted in creating positive change, it offers an opportunity for the investment portfolio to become a quiet partner in that work: steady, responsible and more closely aligned with purpose.
* The companies cited within this article are for illustrative purposes only and not a recommendation to buy or sell.
This blog is marketing material. It is for information purposes only. Certain services described herein are not available to retail clients as defined by the FCA or the JFSC, as applicable; please speak to your investment adviser for further clarification in this regard. All services are subject to status and where local regulations permit. The wording contained in this document is not to be construed as an offer, advice, invitation or solicitation to enter into any financial obligation, activity or promotion of any kind. You are recommended to seek advice concerning suitability from your investment adviser. Any information herein is given in good faith but is subject to change without notice and may not be accurate and complete for your purposes. This document is not intended for distribution to, or use by, any individual or entities in any jurisdiction where such distribution would be contrary to the laws of that jurisdiction or subject any LGT Wealth Management entity to any registration requirements. When we provide investment advice it is on the basis of a restricted approach where we consider a restricted range of products or providers rather than assessing the whole market.
Investors should be aware that past performance is not an indication of future performance, the value of investments and the income derived from them may fluctuate and you may not receive back the amount you originally invested.
.png?sfvrsn=d46d3947_2)
