The HIP Model

Fund Managers

HIP Investor’s unique methodology rates and ranks all types of investments for future risk, return potential and net impact on society.

Companies and municipalities that are measuring and managing impact and risk can be more valuable and resilient in the future. HIP helps fund managers prepare for our changing economy.

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The economy used to be driven by manufacturing, and the value of the enterprise was well-described by tangible assets. However, that has changed.

Research shows that 90% of the enterprise value of public companies is not captured by financial metrics.

HIP Impact Ratings score and rank investments using material metrics from operational outcomes, products and services, and management practices.

Specifically, HIP organizes data and constructs and analyzes 330+ metrics across issuers of stocks and bonds to assess the impact and risk for any investment. All ratings are on a 0-100 scale where 0 is net-negative impact (more extractive) and 100 is net-positive (more generative).

An analysis of the data which HIP gathers and licenses in combination against the HIP Pillars and their components allows HIP Investor to provide analytic products on several levels of granularity: metrics, pillars, and an overall ESG score.

Higher HIP ratings not only provide information on who is providing more positive impact, but they also tend to correlate with higher returns and lower risk. Lower ratings tend to generate lower returns, more volatility, and less impact.

While HIP has 6 strategies available for retail investors, with track records of up to 14 years. For professional fund managers, ratings are also available for license.

  • Overall HIP Rating – Comprehensive Rating on all relevant ESG factors, compared to peers and benchmarks
  • HIP Pillar Ratings – HIP assigns all metrics to one of our 5 Pillars (Health, Wealth, Earth, Equality, Trust)
  • HIP Metric Ratings – Normalized ratios for over 260 individual factors
  • HIP Frameworks Maps - UN SDGs, ICMA, and other leading frameworks
  • IPS Goals, Ratings, and external reporting across asset classes, by stock, bond, muni, fund, ETF and rollup
  • HIP Municipal Data – current and historical impact and outcome data material to issuer sectors

HIP Investor Clients

  • FUND MANAGERS seek an edge with HIP Ratings, which can reveal knowable-yet-ignored risks and potential sources of untapped returns.
  • ADVISERS want to serve those investors who request ESG solutions specifically, those who use their portfolio to fund Impact Investing and want to serve all their customers by pursuing optimal risk-adjusted returns.
  • INVESTORS pursue optimal risk-adjusted returns by incorporating HIP Ratings to select and weight investments in stocks, bonds and funds/ETFs
  • ISSUERS want the benefit of a HIP review to understand how they may improve their future risk-adjusted returns, or want to pre-rate their issuance.
  • MUNICIPALITIES want to compare their issuances with HIP metrics and HIP’s map to SDGs or other frameworks.
  • ACADEMICS want to advance the understanding of the relationship of ESG data to financial returns.
  • BENEFITS ADMINISTRATORS revise 401(k) Plans seeking higher employee recruiting and engagement of their company’s employees who can use HIP Ratings of fund choices to invest for retirement in alignment with their values.

Since the HIP Ratings cover all asset classes, including Corporate Bonds and Equities as well as Municipal and Sovereign Bonds, the ratings can be applied to mutual funds, ETFs, and entire portfolios.