Managing Money for Change

Do you believe that (a) everyone deserves a fair shake, (b) the environment shouldn't be sacrificed for the sake of short term gain and (c) that companies should be rewarded for embracing and supporting a diverse workforce? But then you read that several companies in your retirement account or investment portfolio are failing on these fronts and others?

For many of us, this disconnect between our values and hopes for a better world and how our financial resources are invested can go from feeling like a gap to a chasm. Fortunately, the community of people looking to bridge that gap continues to grow and deepen. Variously called socially responsible investing (SRI) or mission-related investing (MRI), the array of investors and activists involved has gone from an awakening to a movement in the last twenty years and includes those managing modest retirement accounts to those who have millions of dollars in investment portfolios.

Some of the basics tools that SRI proponents use include investment screens, shareholder activism, venture capital and community investment. Investment screens are a basic tool that allows you to include or exclude anything you don't want in your portfolio. For example, you might not want firearms and you might want renewable energy.

Shareholder activism means using your proxy votes to influence companies on issues like domestic partner benefits or environmental impact. This strategy works best when you organize with others who share your values, for example, through the Interfaith Center for Corporate Responsibilities.

Progressive venture capital is a way to be even more active if you're willing to take a little more risk by investing in young companies that are pursuing socially responsible purposes. This approach requires more research, but some mutual funds and "investor circles" have begun to take on this work.

Finally, community investment means banking at Community Development Financial Institutions. They operate much like any other bank. The difference is that they're committed to serve the needs of low income people.

Donor Program

North Star Fund's Donor Program offers donor activists resources and guidance on how to use their money to support the world we all want to see. Launched in 2008, this program connects our community to the latest trends in using progressive values to shape estate and retirement planning.

Resources

North Star Fund's Donor Program

Handbook on Responsible Investment Across Asset Classes, by David Wood and Belinda Hoff

As You Sow Foundation

Interfaith Center for Corporate Responsibilities