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INVESTING AT FIDELITY
ALL IN A DAY:
NICOLE CONNOLLY
As head of ESG investing at Fidelity Investments, Nicole Connolly works to satisfy the needs of shareholders while also making a tangible impact on society and the planet. It’s a job she finds powerfully inspiring.
INVESTING WITH A PURPOSE
For Fidelity Portfolio Manager Nicole Connolly, seeking returns for her shareholders and making a positive impact on the world are not mutually exclusive goals. In fact, they’re closely aligned—and at the heart of her unique investing approach.
As head of ESG investing, Connolly seeks out companies that allow investors to align their capital with their values, while seeking to generate positive returns over time. Short for “environmental, social and governance,” ESG-oriented funds consider a business’ commitment to doing right by not only their employees and customers, but also the communities in which they operate. These funds also assess the makeup of a business’ governing bodies and management teams, gauging areas like diversity and capital allocation.
“What ESG research allows us to do is analyze issues that any long-term owner should care about.”
“What ESG research allows us to do is analyze issues that any long-term owner should care about,” Connolly says. “As people start to understand that you don’t have to sacrifice performance to invest with impact, the conversation moves from, ‘Why would I invest with an ESG lens?’ to ‘Why wouldn’t I invest in a way where I can get competitive returns, while also having a positive impact on society and the planet?’”
Within the “social” sleeve of ESG, Connolly manages the Fidelity Women’s Leadership Fund, which is focused on gender diversity. The fund is composed of companies with 33% female representation or higher on the board or a female C-suite member, or companies that have a commitment to gender diversity through policies and initiatives. Beyond paving the way for tomorrow’s female leadership, Connolly notes that research has shown gender-diverse companies have outperformed the market over the past 10 years.
“If the S&P looked like my fund, we would have 150 more female CEOs and 100 more female CFOs. We would have twice the number of boards with 30% female representation,” Connolly says. “So the purpose is to pave the way for future female leaders, and also help women across all industries, at all levels, thrive in their career.”
In both aspects of her role, Connolly relies on world-class research and in-person observations to help her make investing decisions. In the ESG space, Fidelity’s expertise stems from an authentic dedication to the concept’s core principles, having itself committed to sustainability, inclusivity and many of the same qualities sought from the companies in which it invests.
“We have long embraced principles around sustainability, whether it's limiting the impact we're having on the environment or trying to do right by our employees,” Connolly says.
Ultimately, there’s satisfaction in knowing she can satisfy the needs of her shareholders while making a tangible impact on the world around her. At the end of the day, that mission is as personal as it is professional.
“I have four kids, all 7 and under, and it’s a powerful motivator to think about this work and how it could impact them longer term,” Connolly says. “I feel very fortunate to be doing this work at Fidelity—to have Fidelity’s commitment to ESG.”
Watch Connolly’s video to learn more about her ESG investment process.
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In her 19 years with Fidelity, Connolly says she’s been a beneficiary of the company’s “talent mobility and growth mindset.”
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Fidelity itself is authentically dedicated to ESG, including its commitment to promoting female leadership, Connolly says.
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Connolly and her team find visits to solar farms and other company sites essential to her investing process.
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During store visits, Shaw observes shifting consumer preferences in action.
UNDERSTANDING THE GLOBAL PICTURE
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Wall Street Journal Custom Content is a unit of The Wall Street Journal advertising department. The Wall Street Journal news organization was not involved in the creation of this content.
Investing involves risk, including risk of loss.
1 - Source: Thomson Reuters, Fidelity Investments (FMR) as of April 2019.
Data as of June 2008 – June 2018.
Not intended to represent the performance of any Fidelity fund or funds.
Investment universe made up of top 1000 companies by market capitalization for each time period.
Filters include: 1.) companies that have 2 or more gender diversity corporate governance policies in place, according to Thomson Reuters data as of each historical period, and 2.) companies that are in the top ½ of female representation in senior management roles within each company’s sector according to Thomson Reuters data as of each historical period.Average annual excess returns of 99 basis points (a basis point is one one-hundredth (1/100 or 0.01) of one percent) per year are equal-weighted returns relative to the sector-adjusted benchmark. Note that the benchmark was modified to avoid sector bias, such that each benchmark sector weighting was adjusted to equate to the sector weightings of companies that meet both of the diversity criteria above.
Because diversity metrics are typically reported in Corporate Social Responsibility (CSR) reports within six months after the end of a fiscal year, we post-date fiscal year data to the following June (e.g. June 2009 incorporates fiscal year 2008 data for all companies) to avoid any look-ahead bias.
Before investing in any mutual fund or exchange-traded fund, you should consider its investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus, offering circular or, if available, a summary prospectus containing this information. Read it carefully.
Fidelity Investments and the Fidelity Investments and pyramid design logo are registered trademarks of FMR LLC. The third-party trademarks and service marks appearing herein are the property of their respective owners. Wall Street Journal Custom Content and Fidelity Investments are independent entities and are not legally affiliated. Fidelity products and services are offered by Fidelity Brokerage Services LLC, Member NYSE, SIPC. 883213.8.0
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