Companies are not just about the bottomline

Due consideration of risks and opportunities create value for shareholders and local communities alike. Research on the gold mining sector showed that miners gained financially if they had a track record of positive engagement with communities.

Indeed, the breakdown of relationships with communities have often resulted in mines being shutdown or crippled by production delays.

Non-financial indicators of success are not obvious, and environmental and sustainability issues can be hard to present in financial statements. That is precisely why they can be a crucial factor for active investment managers who know how to find and measure them.

The author is equity strategist of UBS Global Asset Management.