RSF Social Finance: Making money, making change

February 17, 2013
Happy customers of Revolution Foods

Happy customers of Revolution Foods

If you have a few extra dollars in savings, and you’d like to earn more than 0.00001% interest or whatever it is your bank or money market fund is paying, and you’d like to support socially-conscious businesses, you’ll want to take a look at RSF Social Finance.

RSF Social Finance is a financial services organization of modest means (about $145 million in assets under management) that is bursting with big ideas and bold rhetoric. It calls itself “a leader in building the next economy.” It seeks to generate “social and spiritual renewal through investing, lending and giving,” Its mission is to “transform the way the world works with money.”

Whew. What’s going on here?

To find out, I visited RSF Social Finance’s offices in the Presidio complex in San Francisco last week to talk with Don Shaffer, the organization’s president and CEO.

At the simplest level, RSF looks and acts very much like a bank: Its flagship product, the Social Investment Fund, takes deposits and makes loans to so-called social enterprises, a term that’s widely (and often carelessly) thrown around to describe businesses or nonprofits whose intention is to improve society and the environment.

Deciding what qualifies as a social enterprise is subjective, at best. That said, the RSF Social Investment Fund supports companies and nonprofits that, by all appearances, do great work. Among them: [click to continue...]

Filed Under: Consumption, CSR, Environment, Food, Investing, Social Entrepreneurs, Socially Responsible Investing, SRI, Sustainability, Transparency Tagged With: , , , , , , , , , ,

Deep green investing: a closer look

February 3, 2013
A divestment rally at Harvard

A divestment rally at Harvard

As you’ve no doubt heard, Bill McKibben and his allies at 350.org have launched a  a national campaign to persuade colleges, universities, churches, foundations and, yes, people like you and me, to stop investing in the fossil fuel industry. The campaign raises interesting questions as, I’m sure, McKibben hoped it would. Among them:

Does divestment make sense as a strategy to curb climate change?

If those of us who are concerned about climate change want to align out investments with our beliefs, what options are available?

In a column called Deep Green Investing published last week by Ensia, a lively new online magazine about environmental solutions, I argued that, by itself, divestment will probably not accomplish much. Having said that, the campaign could prove useful as one of a number of tactics being deployed by 350.org, the Sierra Club and others that are aimed at bringing about political change–namely, taxes or caps on global warming pollutants, EPA rules to curb coal-burning, etc.

In The Nation, Mark Hertsgaard argues that these grass-roots climate efforts have already produced results–350.org galvanized opposition to the Keystone Pipeline, which may have persuaded President Obama to delay a decision after the election, and the Sierra Club’s Beyond Coal campaign has, along with cheap natural gas, helped drive the decline of coal in the US. Hertsgaard writes:

As important as the victories themselves was how they were won. Both the Sierra Club and 350.org eschewed the inside-the-Beltway focus and top-down political strategy of big mainstream environmental groups, as exemplified by the cap-and-trade campaign. Instead, they emphasized grassroots organizing at the local level on behalf of far-reaching demands that ordinary people could grasp and support. Their immediate goal was to block a specific pipeline or power plant, but their strategic goal was to build a popular movement and accrue political power.

This is the political context in which the divestment movement makes sense. It won’t shake up the oil industry–the Ensia story explains why–but it’s a useful organizing tool.

But what might the campaign mean for investors? Today, I’m taking a closer look at a couple of “deep green” broadly-diversified mutual funds that have decided, unlike most other funds that market themselves as green or socially responsible,” to cleanse their portfolios of companies that extract fossil fuels. [click to continue...]

Filed Under: Climate Change, CSR, Energy, Environment, Socially Responsible Investing, SRI, Sustainability Tagged With: , , , , , , , ,

In Israel, clean tech is not the new new thing

January 13, 2013
David Ben-Gurion, a clean tech pioneer

David Ben-Gurion, clean tech pioneer

Sounding more like a clean tech venture capitalist than a head of state, David Ben Gurion, the first prime minister of Israel, once said that Israel requires “the study of desalination, massive utilization of solar energy, preventing waste of useful rainwater and maximization of power from wind turbines.”

Ben Gurion, who was born in 1886, said this in 1955. This was a man ahead of his time.

Since then, an Israeli company called Netafim pioneered the idea of drip irrigation in agriculture to save water, another called Luz built the first solar thermal power plants, still another called IDE Technologies became a global leader in desalination and Chromagen developed solar thermal water heaters that can be found on most rooftops in Israel, and elsewhere.

Today, Israel, which has been dubbed Startup Nation, remains a seedbed of clean tech innovation–last year it ranked second in the world (behind Denmark) in a report called Coming Clean: The Cleantech Global Innovation Index 2012 [PDF, download] by CleanTech Group and WWF.  I visited Israel last week, and had a chance to talk with a founder of Israel Cleantech Ventures, the chairman of a company called Miya Water and executives at electric-car company Better Place. I’ll report this week on my findings.

First, some context. As Ben-Gurion saw more than half a century ago, Israel is short on natural resources–water, land, oil–and thus needs to use what it has efficiently. This is the biggest, but not the only, explanation for the growth of Israeli clean tech. Most everyone serves in the military, exposing them to advanced technology. Ariella Grinberg, a young associate with Israel Cleantech Ventures, told me she did her service in the Israeli equivalent of the US’s super-secret NSA (National Security Agency), overseeing a multimillion dollar budget and sophisticated software, when she was just 19. The country also benefits from its world-class colleges and universities, among the Israel Institute of Technology, aka the Technion, the nation’s oldest university. (Here’s a fun example of what their students can do.) A strong entrepreneurial spirit pervades the culture, which may also have its roots in universal military service. “People come out of the army, they’re tired of taking orders, they want to be their own boss,” one executive told me. Finally, targeted government support for basic research has helped underwrite the sector. [click to continue...]

Filed Under: Climate Change, Energy, Environment, Investing, Socially Responsible Investing, SRI, Sustainability, Water Tagged With: , , , , , , , ,

Should “green” funds invest in fossil fuels?

December 2, 2012

Bill McKibben’s groundbreaking Rolling Stone story (Global Warming’s Terrifying New Math) and 350.org’s “Do the Math” divestment campaign raise important and difficult questions about fossil fuels. One that is starting to roil the world of socially-responsibly investing is this: How should mutual funds that strive to be “green” or “sustainable” or “socially responsible” deal with the fossil fuel companies in their portfolios? Should they divest, as McKibben argues?

That was the topic of a column I wrote last week for the Guardian Sustainable Business, which generated some noteworthy responses. It’s part of the British newspaper The Guardian, which has one of the most popular English language media websites in the world. Here’s how the column begins:

“We’re going after the fossil fuel industry,” Bill McKibben tells about 1,800 cheering fans in a Washington, DC, theatre. “They’re trying to wreck the future, so we’re going after some of their money.”

Al Gore notwithstanding, McKibben – an author, academic and founder of the grassroots climate group 350.org – is America’s leading environmental activist. His 21-city Do The Math tour begins a campaign to persuade colleges, churches, foundations and governments to divest their holdings in coal, oil and natural gas companies.

“It does not make sense,” McKibben tells the Washington audience, “to invest my retirement money in a company whose business plan means that there won’t be an earth to retire on.”

He’s right about that, but the divestment campaign raises a thorny question: where can investors who worry about climate change put their money?

Divest for our Future, 350.org’s divestment website, recommends “environmentally and socially responsible funds“. The trouble is, the biggest and best-known mutual funds that call themselves environmentally and socially responsible also invest in fossil fuel companies. They evidently haven’t heard McKibben’s message.

Is this green?

The column–you can read the rest here–goes on to report that the Parnassus Equity Income Fund  holds about 14% of its assets in oil, natural gas companies and electric utilities that burn fossil fuels, that the TIAA-CREF Social Choice Equity Fund owns shares in dozens of oil and gas firms including Hess, Marathon and Sunoco, and a pair of shale gas giants, Devon Energy and Range Resources, that the Calvert Equity Portfolio  has about 10% of its portfolio in fossil fuels, including  Suncor, which says on its website that it was “the first company to develop the oil sands, creating an industry that is now a key contributor to Canada’s prosperity,” and that the Domini Social Equity Fund has, among its top 10 holdings, Apache Corp, an oil and gas exploration and production company.

Are you surprised to learn that these funds invest in oil and gas companies, including those in the Canadian Tar Sands? Perhaps naively, I was. [click to continue...]

Filed Under: Climate Change, CSR, Energy, Environment, Investing, Socially Responsible Investing, SRI Tagged With: , , , , , , , , , ,

Chevron. Sustainable. Really?

November 28, 2012

It’s not every day that one of the world’s biggest corporations files an ethics complaint against a little-known government official–in fact, if it’s happened before, I missed it–but that’s exactly what Chevron did last week in the state of New York.

The company accused Thomas DiNapoli, the state comptroller, who oversees the state’s pension fund, of accepting about $60,000 in campaign contributions from lawyers and supporters of people who are suing Chevron in Ecuador. The campaign donations, it is alleged, influenced DiNapoli to use his power as the trustee of  the pension fund, which owns Chevron stock, to push Chevron to settle the long-running, bitterly-fought lawsuit.

Imagine. Politicians being influenced by campaign donations.

Chevron would know about that. Last month, the company donated $2.5 million to the Congressional Leadership Fund, a super PAC that supported House Republican candidates. The donation “appears to be the largest contribution from a publicly traded corporation to a political group” since the Supreme Court’s Citizen United ruling, The Washington Post reported. Chevron also spent nearly $15 million on Washington lobbying since the start of 2011, the Post said.

So…evidently, it’s fine for Chevron to lavish money on politicians but unethical for its opponents to do so.

As it happens, Chevron’s complaint against DiNapoli was not even the most surprising news about the company to surface last week. Even more unexpected was the announcement that Chevron was being added to the holdings of the NASDAQ OMX CRD Global Sustainability Index, a “benchmark for stocks of companies that are taking a leadership role in sustainability performance reporting.”

The NASDAQ CRD Index helps guide investors seeking companies that are more sustainable.  Just a few months ago, at the Rio + 20 confab, NASDAQ  and several other stock exchanges promised, along with the UN Global Compact, to “promote long-term, sustainable investment in their markets.”

But what does that mean when an index includes Chevron, America’s second-biggest oil company? [click to continue...]

Filed Under: Climate Change, Economics, Energy, Environment, Investing, Socially Responsible Investing, SRI, Sustainability Tagged With: , , , , , , , , , , , ,

What a long strange trip it’s been: How the Social Venture Network changed business in America

November 18, 2012

Ben Cohen, of Ben & Jerry’s renown, is asking me for money, and he’s not selling ice cream. I give him a dollar bill, he stamps it in red ink — NOT TO BE USED FOR BRIBING POLITICIANS — and returns it to me. It’s part of his new crusade to get corporate money out of politics.

“Corporations are not people, and money is not free speech,” Cohen declares.

The 61-year-old ice-cream mogul sold Ben & Jerry’s to Unilever in 2000.  (He’s on the left, without his trademark beard, next to his longtime pal Jerry Greenfield.) The T-shirt says: “Stamp Money Out of Politics.” These days,  as “Head Stamper” at StampStampede, Cohen is working for an amendment to the US Constitution to get money out of politics.

It sounds improbable but no more improbable than this: That a gathering of about 70 people, including Ben and his partner Jerry Greenfield, at the rustic Gold Lake Mountain Resort not far from Boulder, Colorado, Colorado back in 1987 could spawn a movement that has changed the way millions of Americans think about and do business. The Gold Lake get-together led to the creation of the Social Venture Network (SVN), a group of business people, investors and philanthropists, many of them shaped by the political and cultural movements of the 1960s, who believe that business can change the world for the better. About 700 SVN members, friends and family gathered last week in New York for a 25th anniversary dinner and celebration–a time to assess how far their movement to remake business has come, and how far it needs to go.

The dinner was a star-studded affair, at least for those of us who pay attention to businesses that aim to build a more just and sustainable economy. On hand along with Ben and Jerry were Eileen Fisher of the eponymous clothing company, Gary Hirshberg of Stonyfield Farm, Drew and Myra Goodman of Earthbound Organic, George Siemon of dairy co-op Organic Valley, Jeffrey Hollender, formerly of Seventh Generation, Chip Conley, founder of Joie de Vivre Hotels, Roger Brown and Linda Mason of Bright Horizons, Amy Domini of Domini Social Investments, all of whom were named to the SVN “Hall of Fame.” Spotted in the crowd of 700 or so were Gifford Pinchot III, president of of Bainbridge Graduate Institute, my friends Seth Goldman of Honest Tea and author Mark Albion (More Than Money: Questions Every MBA Needs to Answer), Danny Kennedy of Sungevity–the closest thing to a power elite of the sustainable business movement.

None of them, to be sure, run FORTUNE 500 companies. But the movement birthed by SVN powered the field of corporate social responsibility, opened up new possibilities for entrepreneurs, raised expectations that big companies now need to meet and helped shape the way companies ranging from Google (“Don’t be Evil”) to Walmart do what they do. [click to continue...]

Filed Under: Business Ethics, CSR, Environment, Food, Leadership, NGOs, Politics, Small Business, Social Entrepreneurs, Socially Responsible Investing, Sustainability Tagged With: , , , , , , , , , , , , , , , , , ,

Commerce and conservation in Africa

September 25, 2012

A conservation lodge in Namibia

Much of Africa, you may be surprised to learn, is growing faster than the US. The economies of Kenya, Ghana, Botswana, Rwanda and Tanzania all grew by at least 4% last year. (US GDP growth was 1.7 percent.) But while modernization is lifting millions of Africans out of poverty, unchecked growth — of farms, ranches, mining and infrastructure — threatens Africa’s unsurpassed wildlife and wild places.

Can commerce and conservation coexist in Africa? A nonprofit called the African Wildlife Foundation (AWF) has set out to prove that they can do better than co-exist: It is going into business for itself to demonstrate that thriving commercial enterprises, if run right, can help protect wildlife and their habitat.

Last year–its 50th anniversary year–the foundation created an  investment company called African Wildlife Capital to raise money from investors in the US to support conservation-friendly businesses in Africa. African Wildlife Capital has raised about $3 million, all of it through its own board, and so far it has invested in three projects–an avocado farm in Tanzania, a livestock operation in Kenya and a tourism lodge in Namibia. [click to continue...]

Filed Under: Climate Change, Economics, Environment, Investing, NGOs, Socially Responsible Investing, SRI, Sustainability Tagged With: , , , ,

Corporate sustainability, by the numbers: Who’s up, who’s down, who cares?

September 13, 2012

This has been a big week for corporate sustainability rankings, with the Dow Jones Sustainability Index (DJSI) and the Carbon Disclosure Project releasing new reports. Vote Solar and the Solar Power Electric Industries Association showcased the  top 20 corporate users of solar power in the US. A book called Good Company just landed on my desk, along with its own 2012 Good Company Index. And October will bring the World Series, Halloween and, of course, the annual Newsweek “green” rankings of big public companies.

All of which raises a couple of questions.

Do these ratings and rankings matter?

More important: Should they?

Undeniably, they do matter, mostly but not entirely because of the prestige they confer upon companies that do well. Press releases are flying! “Carbon Disclosure Project Salutes Con Edison” (Really?) “PepsiCo Earns Sustainability Accolades.” “GM Named Top Solar User in the U.S. Auto Sector.” This is all well and good. Some middle-management executive had to fill out those CDP forms or buy those solar panels, and why not recognize their efforts with a salute or an accolade? [click to continue...]

Filed Under: Climate Change, CSR, Energy, Environment, Investing, NGOs, Socially Responsible Investing, Sustainability Tagged With: , , , , , , , , , , ,

Microfinance’s odd couple

May 1, 2012

Like politics, poverty alleviation makes strange bedfellows. CARE is one of the world’s largest humanitarian organizations, formed in the aftermath of World War II to deliver relief to a battered Europe.  (CARE then stood for Cooperative for American Remittances to Europe. Who knew?) Mennonites are a Christian, but neither Catholic nor Protestant, faith organization with a strong tradition of pacifism and service. Together, they stand behind a for-profit company called MicroVest — whose purpose is to help build capital markets serving the global poor, and whose investors include J.P. Morgan Chase and Prudential Insurance.

Strange bedfellows, indeed–and that’s no accident, as Gil Crawford, the CEO of MicroVest, told me when we met recently.

MicroVest, he told me, reflects a belief that we no longer live in a binary world, one that’s divided between amoral profit-maximizing companies and pure-of-heart nonprofits aimed at doing good.

“Our core premise is that doesn’t work,” Crawford said.

Instead, MicroVest raises money from institutional investors, mostly here in the US, then makes loans or equity investments in microfinance institutions around the world that lend money to the poor. This activity is designed to generates positive financial returns for everyone along the line–the US investor, MicroVest, the local lender and the ultimate borrow. It’s using the power of business to fight poverty. [click to continue...]

Filed Under: Economics, Global Poverty, Investing, NGOs, Small Business, Social Entrepreneurs, Socially Responsible Investing Tagged With: , , , , , , ,

Starbucks: We are indivisible

October 30, 2011

I’m not much for patriotic displays, but I’m proud to wear this red, white and blue wristband inscribed with the word INDIVISIBLE.

I hope you’ll wear one, too. They’re available, beginning Tuesday, at Starbucks, for a donation of $5 or more to a project called Let’s Create Jobs for USA.

The program aims to create thousands of jobs across the country, by investing community development financial institutions (CDFIs) — mostly credit unions and community banks — that will then lend to small businesses, nonprofits, housing and commercial developers, micro-enterprises and the like, all to spark the economy and create jobs.

I’m a fan of this project,  for several reasons.

First, there’s no more front-of-mind issue in America today than jobs. So this a great example of how a big company can help tackle an important  problem–while enhancing its reputation as a business that supports its communities.

Second, Let’s Create Jobs for USA underscores the fact that, despite the rhetoric from politicians, jobs are best created by the private sector.  If you’re anti-business, you’re anti-jobs.

Ben Packard

Third, although credit for the campaign ultimately belongs to Howard Schultz, Starbucks CEO, Let’s Create Jobs for USA unfolded as it did because of a connection between Ben Packard, vice president of global responsibility at Starbucks and Mark Pinsky, president and CEO of the Opportunity Finance Network, a national network of CDFIs. Ben, Mark and I serve together on the board of Net Impact, a great organization of students and young professionals whose purpose is to inspire and equip young people to use the power of business to make the world a better place.

Let’s Create Jobs for USA is very much in the spirit of Net Impact. [click to continue...]

Filed Under: Economics, Leadership, NGOs, Politics, Socially Responsible Investing, Sustainability Tagged With: , , , , ,
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