Financial markets seem to have found a comfortable trading zone, oscillating between the hope of a quick recovery and the fear of a second pandemic wave.

Federal Reserve Chairman Jerome Powell suggested in an interview that GDP could fall by as much as 20–30%, with unemployment hitting Depression-era levels. However, the Chairman also expects a quick recovery by the end of this year and noted the unprecedented response from central banks and governments to keep markets liquid and provide emergency benefits to struggling people and businesses. This mixed message has the bulls and bears of the market duking it out day-to-day, keeping prices relatively flat over the past month.

With uncertainty remaining, investors should hope for the best and plan for the worst. We examine two sustainability leaders that are positioned to grow if the economy reopens quickly and will continue to earn profits during a longer period of pandemic-induced economic pain.

Note: These are investment ideas, not recommendations. Speak to a financial professional before investing and ensure that any holdings are part of a more diversified investment strategy.

Unilever

Who hasn’t indulged in comfort food a little more often since the pandemic started? Well, if you think people are more likely to drown their sorrows in a pint of Ben & Jerry’s ice cream, then you might consider taking a closer look at Unilever. Unilever owns a whole bunch of well-known brands from soaps (Dove) and cleaners (Seventh Generation) to soups (Knorr) and ice cream (Ben & Jerry’s). Consumer behaviour has changed drastically since the pandemic and consumer staples companies like Unilever are quickly trying to figure out what changes will persist.

Unilever released its 2020 Q1 trading statement last month and reported that overall sales were flat. Hidden in this boring top line figure is a much more nuanced story. Sales of packaged foods, cleaning supplies and beauty products were up due to households ‘stocking up’ but Unilever’s food service business and restaurant sales were way down. Moreover, management noted that the use of beauty products like deodorant was down about 25%. Yes, we’re getting stinky working from home. Unilever seems like the perfect company for investors caught in the hope and fear dichotomy. The company is positioned to weather an ongoing storm but will also get a boost if the economy reopens quickly.

Unilever has set ambitious environmental, social and governance targets in its Sustainable Living Plan, like halving the environmental footprint of its products by 2030. The company’s sustainability reporting is top-notch and measures progress on issues like gender diversity, the health and hygiene of consumers and carbon emissions. Forty-sixth on the 2020 Corporate Knights’ Global 100 list of the world’s most sustainable corporations, I’m confident positioning Unilever as a global sustainability leader.

Unilever’s share price fell by 27% during the crash and is currently down about 11% since the start of the year. The stock is expected to pay a 3.39% annual dividend.

Cisco

Cisco is an American tech company that earns most of its revenue from selling infrastructure platforms made up of networking hardware like routers, switches and data centres. As more business happens online, Cisco has diversified to offer applications, security and technical support services. Cisco’s customers are mainly large corporations, and its revenues declined in March as hardware supply chains were impacted and companies cut back on major investments due to market uncertainty. However, security revenues grew and the use of Cisco’s WebEx video conferencing software tripled.

Large companies are quickly realizing just how important online infrastructure platforms are to continued profitability while everyone works from home, so I expect to see corporate investment in digital hardware pick back up whether or not the pandemic drags on. Even if the economy rebounds quickly, companies are noticing the benefits of an online workforce and many of the work from home and shop from home trends will persist. Cisco is heavily involved in the deployment of 5G networks throughout the world as it sells high-speed routers and switches that manage back-end data transfers. The company is hoping to build on its leadership in the Internet of Things space, and I expect this rollout to occur whether or not the pandemic persists in spite of the 5G COVID-19 conspiracy theories my uncle is posting on Facebook.

From a sustainability perspective, Cisco stands out as a leader in the tech sector. The company has assessed a wide range of environmental, social and governance issues based on both business and stakeholder importance, and has created concrete targets like impacting 1 billion people through social impact grants and programs by 2025 and cutting Scope 1 and 2 greenhouse gas emissions worldwide by 60% by 2022. Cisco publishes a thorough annual corporate social responsibility report to measure and track progress towards these goals. The company gets top marks from sustainability data providers Sustainalytics and MSCI, and is ranked fourth on the 2020 Corporate Knights’ Global 100 list of the world’s most sustainable corporations.

Cisco’s share price fell by 33% during the crash and is currently down about 11% since the start of the year. The stock is expected to pay a 3.2% annual dividend.

Tim Nash blogs as The Sustainable Economist and is the founder of Good Investing. This article was provided by Corporate Knights magazine.

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Born and raised in a small village near Sidon, Lebanon, Dagher immigrated to Canada a little over thirty years ago during the last few years of the country’s crushing civil war. When she arrived in 1989 as a 17-year-old new mother, she was fleeing political strife and a challenging arranged marriage. She didn’t speak a word of English.

“I’m incredibly proud of all the hardships I’ve gone through from being born and raised in a war zone and spending most of my early life in a bomb shelter to coming here and learning everything from scratch.”

Dagher had studied accounting and finance in Lebanon at Middle East College, but finding a job in Canada was initially challenging. Her earliest role in telecommunications was as a Bell telemarketer. By the end of her fifteen years there, she had climbed through the ranks to a director post.

“I don’t have a master’s degree in technology or engineering or anything like that, I was just determined to succeed no matter what.”

Dagher left Bell to take an executive sales director job at Dell Canada before eventually becoming vice president of the computer firm’s data storage division. In 2019, she joined Cisco Systems Canada—the networking hardware and telecommunications equipment and service provider—as president.

“I got to where I am today because of my determination and the passion I have for technology and people,” says Dagher.

This passion for people shows up in her leadership. “My style is very simple,” she remarks, “it’s servant leadership.” She believes in empowering her team and is adamant about the importance of building and supporting the people she works with. “People join organizations, but people leave people,” she says matter-of-factly.

But she agrees that it’s not that easy for women to succeed in the tech sector. While it’s even more challenging for someone with her earlier history, the industry has a long way to go. Dagher’s three-pronged recipe for success for women in the corporate world: advocate for yourself, find a mentor and raise your hand.

“I’m incredibly proud of all the hardships I’ve gone through from being born and raised in a war zone and spending most of my early life in a bomb shelter to coming here and learning everything from scratch.”

She also stresses the importance that failure had in her life, clarifying that she was always keen to learn from it. “Giving up,” she goes on, “was never an option.”

Dagher likes to pay those lessons forward. Case in point: She heads a Cisco career development group called Connected Women that makes sure young female employees and interns feel like they belong and can have influence within the company.  “Our summer internship program is very well paid and we’re very proud of it. We fly them out to San Jose [Cisco headquarters] for a week or two of training and they actually work on innovative challenges,” she explains. The competitive program last year saw 700 applicants for 22 positions.

And with her own experience with forced displacement, Dagher made it a point for Cisco Canada to be involved with Lifeline Syria—a not-for-profit organization that assists in sponsoring, welcoming, and resettling Syrian refugees in Canada—by training and hiring refugees in the tech sector.

These days, the private sector’s foot-dragging on environmental issues is what worries her most. “We’re not moving fast enough. Not enough companies are jumping on it, and a lot are still parking it in the back.”

In an era of accelerated progress, technology is at the heart of every industry disrupting business as usual. If, as a tech corporation, you’re not thinking about the environment and sustainability in relation to your technology, Dagher argues it will be very difficult to succeed.

“At Cisco we take a lot of pride in ensuring we are part of giving back from a responsibility perspective.” For one, Cisco’s Bridge to Possible campaign highlights all the ways in which the company aims to connect people, places, ideas and things through a secure network, and to minimize emissions generated by transportation. That includes enabling workers at companies around the world to work from home and call in through WebEx technology instead of driving into the office.

“We’re not moving fast enough. Not enough companies are jumping on [sustainability], and a lot are still parking it in the back.”

Cisco’s sustainable procurement practices aim to eliminate one million tons of greenhouse gases from the company’s supply chain by next year. Circularity, like for other tech companies, is also a critical point. The company’s products are designed to be maintained and upgraded, ensuring that they remain within the market and away from landfills. Nearly 14,000 metric tonnes of those products were returned and recycled last fiscal year.

Dagher’s achievements are hard to miss. She was named 2019’s Woman of the Year by Women in Communications and Technology—a national association that provides opportunities for networking and professional development for women in these notoriously male-dominated industries.

She is the kind of successful immigrant that Canada loves to embrace. She worked tirelessly within the challenging corporate system to rise to the top and now makes sure to help others in return. “I’m a very proud Lebanese and a grateful Canadian,” Dagher likes to say. As an Arab immigrant woman myself, Dagher is a role model. I tell her that I recently obtained my Canadian citizenship and that interviewing her is moving for me. “Ahlan wa sahlan ou alf mabrouk [welcome and congratulations in Arabic]” she responds warmly.

“You can be anything you want to be here if you have determination.”

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