Socially responsible investing (SRI) isn’t the quietly progressive corner of the financial industry that it once was. For decades, SRI has been practiced primarily by small, independent boutique investment firms. For better or worse, the old landscape has dramatically changed in recent years with record inflows of investor cash and large Wall Street firms looking to stake their claim in this rapidly growing space. We at Natural Investments are eyeing these developments with healthy skepticism. Can we still trust the fund managers we’ve worked with and invested in all these years? What impact will Wall Street’s entry have on our industry?
1: The Securities and Exchange Commission will look at climate, as well as other ESG-related issues, in determining misconduct or mislabeling of information at fund companies. The federal agency’s move is meant to address possible greenwashing. Investment News: SEC establishes task force on ESG issues
2: The oil giant Exxon lost a historic proxy battle after a small hedge fund won three board seats, with the goal of pushing the company to address climate change. Shareholder support for environmental and social resolutions is on the rise, with significant implications for companies around the world. Barron’s: Exxon’s Shareholder Revolt is a Warning for Boards Everywhere
3: A record-setting 81% of shareholders voted for DuPont chemical company to report on plastic pellets (also known as “nurdles”), chemical spills in the ocean, and general supply chain issues. As You Sow: DuPont Shareholders Approve Proposal Calling for Plastic Pellet Pollution Reporting
4: Natural Investments advisor, Malaika Maphalala, shares her journey as a woman of color leading change in the finance world. Green Money Journal: On the Road to Gender and Racial Equity in Finance
5: The gap between workers and CEOs widened during the pandemic as public companies granted top executives some of the richest pay packages ever. NYT: Meager Rewards for Workers, Exceptionally Rich Pay for C.E.O.s
Federal monetary and fiscal policies buoyed the stock market during the pandemic, but they did not keep millions of American families from sliding below the poverty line. Yet daily news commentaries tracking quarterly earnings and shareholder profits have painted a rosy picture of the 2021 economic recovery. The latest plan by the Biden Administration to help economically struggling families is a step in the right direction, but the proposed measures are not enough to address the threats posed by the extreme wealth disparity in the US that began to take hold decades ago.
Investment advisors who have practiced socially responsible investing (SRI) going back decades as some on our team at Natural Investments have, remember well the doubters’ refrains of our means for social and environmental change: using investment capital does not advance social progress and environmental preservation. There is now evidence to refute them.
One way socially responsible investors create impact is by identifying which companies are exhibiting objectionable practices that undermine social progress or create environmental harm, and will decide to withhold financial backing from such companies. This is known as “avoidance” investing, one of several SRI leverage methods.
To assert that the global COVID-19 pandemic has affected almost every part of our daily lives in 2020 would be an understatement. As the one-year anniversary of the virus’s outbreak approaches, it is becoming clear that some adaptations and trends necessitated by the pandemic are likely to have lasting impacts. For instance, the rise in flexible and home-based working arrangements has forced the commercial real estate market to pivot. And the expansion of voting methods, which resulted in a record turnout in the 2020 US presidential election, has fundamentally changed electoral politics.
Americans will soon vote in an election with unprecedented stakes. The outcome of the presidential and Congressional races will determine whether this country continues its rapid descent into xenophobia, isolationism, and climate nihilism—or whether we open a doorway of possibility to a better future.
“These are tumultuous times.” It sounds like a cliché, but one could argue that it’s an apt description of life on planet Earth right now. As the world continues its struggle with mitigating the devastating effects of the novel coronavirus, the world has witnessed, yet again, horrific scenes of police violence and brutality against Black Americans. As socially responsible investors, we are well aware of the economic and racial disparities that exist across the world and, most especially, in the US—one of the wealthiest nations on the planet. Moments like these, however, bring those disparities into stark relief, reminding us that if ever there was a time to invest in shifting the paradigm of wealth inequality and institutionalized racism, the time is now.
In January, The National Oceanic and Atmospheric Administration (NOAA) reported that 2019 was the second hottest year on record, following closely behind 2016. The planet’s five warmest years have all occurred since 2015, and nine of the ten warmest years have occurred since 2005.
There is now overwhelming scientific consensus that CO2 emissions from fossil-fuels are a primary cause for our rising average global temperatures. The US Environmental Protection Agency (EPA) states, “Human activities are responsible for almost all of the increase in greenhouse gases in the atmosphere over the last 15 years.” The obvious remedy? A steep reduction of CO2 emissions.
This article is the second of a two-part series by Tiffany Brown exploring the racial wealth divide across the Deep South.
The Legacy Museum in Montgomery, Alabama tells the story of stolen people, enslavement for free labor, the premature withdrawal of federal troops after Emancipation, and the lack of enforcement of the Civil Rights Act of 1866. Back then, Black Codes legalized the arrest and punishment of Black people who didn’t have proof of employment, which led to convict leasing. In 1898, 73 percent of Alabama state revenue came from convict leasing to the lumber mills and for road maintenance. A full 35 years after Emancipation, Blacks were still being forced into free labor throughout the South.
In the museum, I learned of several laws that sought to block access by Black people to economic and political systems—on top of school segregation (which didn’t end until 1954) and the prohibition on Black voting until 1965. There was Shelley v. Kraemer (1948),
In a time of trade wars and political leaders on the fritz, investors may consider more conservative options to avoid market volatility. Real estate, bonds, and even gold might look appealing in times of turmoil. For socially responsible investors with even a cursory awareness of the gold mining industry, however, the question of whether gold holdings are compatible with human rights and environmental protection is urgent and important.
No Dirty Gold is an advocacy group of nonprofits and companies in industries that use gold. The group supports voluntary improvements in environmental and social practices by the industry.