JUST Chart of the Week: Companies Most Dedicated to Their Stakeholders Have Outperformed the Market During the Coronavirus Crisis

JUST Capital’s Large Cap Diversified Index (JULCD) Index, which tracks the companies most dedicated to their stakeholders, has continued to outperform the market throughout the coronavirus crisis.

Since the top of the bull market on Feb. 21 this year, we have seen unprecedented levels of volatility, with returns plummeting upwards of -40%. Our JULCD Index has continued to show resilience, outperforming the Russell 1000 by 100 basis points and proving that investing sustainably does not sacrifice financial performance.

The JULCD Index has outperformed the Russell 1000 during the coronavirus crisis. (Steffen Bixby/JUST Capital)

Research this week from Morningstar showed that throughout the coronavirus crisis, ESG funds have outperformed the market.

And investors are taking notice, as we continue to see assets swell into the space. Per Bank of America, assets increased by 4.50% from Jan. 1 through Mar. 25, while S&P 500 ETFs have seen a -30.50% loss in AUM over the same period.

Investing in high quality companies focused on sustainable governance that carry clean balance sheets better position investors to weather downturns like the one we are in. Unlike 2007-2008, we are not involved in a financial collapse.

In our current crisis, the “S” in ESG stands for “Support.” The companies in the JULCD are prioritizing their focus on supporting the economy – their workers, communities, and consumers – and will see this benefit long term. It’s why we believe the COVID-19 pandemic will be the turning point in which we finally see the stakeholder-first model overturn shareholder primacy.