In one of the recent Invest for Better Circle meetings of my Boston group, the question emerged: “Is the role of the advisor to lead or follow you?” Circle members Amy Brakeman and Maria Jobin-Leeds had a lot to say on this topic, so I asked them for an in-depth interview to dig deeper. As you’ll read, their responses indicate an evolution in their thinking and experience over time.
Ellen: You’ve both been at this business of investing for good for a while. When you were first looking for impact investing advisors, what qualities were you looking for?
Maria: It was 20 years ago when we first came into this money and I really had no experience. Luckily, we had some time to be methodical about it. I was looking for someone who would look at me (as a woman), be kind to me; who I would feel safe and respected by. I was looking for someone local, who I could have a relationship with. And we were looking for someone who would do good with the money; I think we called it SRI back then.
We interviewed 4 teams; all of whom were either led by or included females. One guy, however, never looked in my eyes; so he lost the job in 5 seconds. The choice we made included an all female team, including a leader who took a lot of guff when she pushed SRI so many years ago and I really wanted to support her. I continue to adore them and find them respectful, values-centered and welcoming. Later, after the 2008 market crash, we added another research-driven advisor to work with the Foundation, and were happy that the staff included two progressive people of color.
Amy: For me, the money was and wasn’t sudden. My husband was a professional money manager and, in the beginning, we used to talk about all of our investments. As time went by, I got more focused on philanthropy. When we got divorced, I suddenly had cash that needed to be invested. In looking for an advisor, I didn’t care about geography but they had to be in the top quartile of impact investing advisors; and not just doing ESG in public markets. I care about deeper impact through all asset classes and across all pockets of assets. I didn’t want anybody affiliated with a big bank or who sold product. Given this frame, I mainly found small shops which can be vulnerable to having their business model work so there can be turnover of individual advisors and mergers. It felt like a high stakes decision that couldn’t switch if it turned out wrong – which I’ve learned is not true. I prioritize what my network recommends and I kept hearing about a few advisors from folks in the Toniic and Gratitude Railroad networks. It was at one of those meetings that I ran into both finalists and decided to go with the one that I thought I could have more of a personal relationship with. My lead advisor is excellent; someone who is super connected and committed, who can blend investing and philanthropy.
Ellen: Now that you’ve been at it for a while, have your views changed on the qualities that you want in your impact investing advisors?
Maria: I’m a different person 20 years later. I have more confidence and gender isn’t as important to me. As I keep my eyes open for additional advisors, I have people on the list who aren’t local but I still want a relationship and see them face-to-face. I will press them more on the specifics, their definition of impact and their metrics – which I couldn’t have done initially. At that time I was more focused on finding someone who could make me competent enough to give direction!
Here’s an example of how I have changed and this informs my thinking about what I would want in an advisor. I remember getting into a 1 hour discussion with one of my advisors who didn’t think that I should put more into CDFI’s because of the impact on my asset allocation. I was practically in tears, because I wanted to put money at the local level in the hands of people of color, but realized that my advisor had been trained for years with this mindset and I was bumping up against it. After a few days, I decided to do it anyway.
Amy: In the first few years, my advisors led me, which is what I wanted. I wanted them to help me shift quickly from cash to a diversified impact portfolio. I would add a few investments from my networks in Africa and work on education to employment. So all was going well generally. However, I noticed that the private funds and direct deals I added to the pipeline would get stuck in due diligence.
During Spring 2020, when I saw the Covid-related health disparity outcomes along racial lines, I started being far more assertive in my investing. As I sourced and wanted to proceed with funds led by Underrepresented People of Color who were launching new funds or ventures, I was often told “Wait until Fund II.” At this point, I dove in to lead and approve selected private investments. Interestingly after my decision to invest in specific funds, other investors at the same advisor would invest also.
In 2021, I have also added two “satellite” advisors to my core advisor so that I have access to a bigger and relevant pipeline and a DD process that meets my strategy around being more redistributive in getting capital and returns to people who have been systematically denied access. My goal is not to make as much money as I can; my goal is to make as much impact in the world while at the same time earning enough for my lifetime. I am risk tolerant and have become aware that the financial system is risk averse and isn’t going to move as fast as I want it to. My new approach is working very well.
Maria: That is a critical change point that not everybody gets to, but I’m also at that point. All of the things I wished for in that first phase are not adequate for the second phase. How do you find someone who doesn’t have that box around them? The bulk of what they are doing is incrementally improving on Capitalism 1.0. I’m looking for 2.0 and they are harder to find and to some degree it becomes a partnership in this phase.
Ellen: What do you think is the role of the asset owner – you – in influencing the impact advisory field? What about groups like Invest for Better?
Maria: We have a remarkable ability to change our advisors and that will change the field. One of my key advisors developed expertise in this because clients were whining about it. She told me that she loved it when I would ask for things because she improved, and the firm improved. In fact, she became so competent, she was snatched away by a major asset owner!
Amy: I agree completely. And I think that Invest for Better Circles makes for better consumers; if more of us assert our needs; then we will change the system. Then Maria and I won’t be the outliers talking to our advisors. IFB Circles can give more women voice and power, and then the whole advisory system will offer more.
Invest for Better is launching a series of blog posts about the important topic of finding and working with financial or investment advisors. We are excited to share this first post, excerpted from Janine Firpo’s forthcoming book, Activate Your Money: Invest to Grow Your Values and Build A Better World (Wiley 2021). It recommends key characteristics of an advisor who will put your values and interests first.
When you’re deciding to stay with your current advisor or to hire a new one, there are seven attributes that will help you determine whether they — and their firm — have your best interests at heart. These attributes will help you determine if they’re committed to values-aligned investing and whether they adhere to an investment philosophy that resonates with you or not. These attributes are as follows.
- Values-alignment is a tenet of their investment philosophy.
When I was younger, I thought all financial advisors believed pretty much the same thing. I was in my early 30s, the first time I talked to a finance expert. Since I didn’t have enough money to warrant an advisor of my own, I spoke to my mother’s advisor. He met with me, on occasion, as a favor to her. At the time, I pretty much believed whatever he told me.
Since then, I’ve learned that advisors have their own investment philosophies as well as their own beliefs about asset allocations, preferred investment vehicles, and impact. Recognizing an advisor’s point of view and biases is critical in choosing someone who’s going to be a good match for you. In fact, I think it’s one of the most important elements of a strong advisor-client relationship. A deep commitment to achieve both financial and social return should be a core tenet of an impact advisor’s investment approach.
One way to uncover an advisor’s philosophy is to gain some understanding of your own. You might want to spend some time examining your own beliefs about investing. For example, are you wary of the stock market, or do you embrace it? Do you have an opinion about the relative value of active versus passive funds? Do you have strong beliefs about specific impacts you want to make with your money? Are you excited by the thought of investing in private deals and other alternatives, or does the idea scare you? And do you want philanthropy to be integrated into your investment landscape?
If you don’t know the answers to these questions or have an investment philosophy of your own yet, don’t worry. These are questions you can revisit as you learn. They’ll become clearer over time. You can use the process of interviewing prospective advisors as an opportunity to listen to different perspectives, gain more knowledge, and further your own views.
- They are a fiduciary.
Almost half of Americans believe that all financial advisors are legally obligated to act in their client’s best interest.[i] However, that isn’t true. Different types of advisors have varying levels of obligation to you. Advisors that are fiduciaries have a legal and ethical responsibility to prioritize your interests over their own or their firms. Regardless of the type of advisor you select, confirm they are a fiduciary.
Registered Investment Advisors (RIAs), one of the most highly regulated types of financial advisors, are bound by law to be fiduciaries. And most, if not all, robo-advisors are registered as RIAs.
- They don’t receive commissions.
Broker-dealers are another type of financial advisor. Also referred to as brokers or stockbrokers, they can provide investment advice to clients just like RIAs. However, they also promote and sell financial products they receive a commission on. In June 2020, the Securities and Exchange Commission (SEC) enforced new reforms that require brokers to perform in the “best interest” of their clients. This new requirement brings brokers closer to the fiduciary role of RIAs. Today, if a broker offers you an investment they receive a commission on, they have to disclose the commission they will be paid as well as any conflict of interest.
An advisor can be both an RIA and a broker-dealer. Before you hire an advisor, ask whether they are affiliated with a broker-deal or could receive commissions as a result of their relationship with you. If an advisor can receive commissions, spend some time considering why they would be preferable to an advisor who only works on your behalf.
- They offer the core and values-aligned financial services you want.
In addition to their core services, a values-aligned advisor should also be able to discuss the selection criteria or impact lenses they will apply to their investment decisions. They should be able to talk to you about how they’ll report on the impact your investments are having and be able to show you sample reports. You should also learn the extent to which they engage in shareholder advocacy as well as what will happen to your proxies.
- They are open to a nondiscretionary relationship.
In a discretionary relationship, you give your advisor the legal ability to buy and sell investments on your behalf without asking you first. In a nondiscretionary relationship, your advisor will suggest investments to you, but you have to approve those recommendations before securities are purchased.
While a nondiscretionary approach provides you with more control, it will take more of your time. It requires you to be more educated about asset allocations, portfolio strategies, and investment options. If you’re willing to commit the time, a nondiscretionary relationship can provide a wonderful opportunity for learning, especially if you choose a financial advisor that takes your education seriously and considers it a part of their job. At this point, most of my assets are self-managed or nondiscretionary. However, I have given discretionary power to the manager of a separately managed public equities account I’m invested in, because she trades more frequently than I want to be involved and I trust her decisions.
While you may provide discretion to your advisor to buy and sell securities on your behalf, they should not have the ability to withdraw your money from your accounts. So, when you are interviewing an advisor, confirm that your money will be held with a third-party custodian, like Fidelity, Vanguard, or Schwab.
- Their fees are fair and follow industry standards.
You should pay either a flat fee for service or a percentage of the assets an advisor is managing on your behalf. Percentage fees tend to be deducted directly from your account and are often on a sliding scale: The higher the investment, the lower the fee. An advisor might charge 1.25% to manage assets of $500,000 or less, then drop to 1.0% for assets of $501,000 or more, dropping again to 0.090% after the first million invested, and so on.
Don’t assume the only fees you are paying are the fees you pay your financial advisor. Most likely you’ll pay additional fees for any funds, private investments, or other assets your advisor is managing. These fees can be quite low, as is the case of index funds (0.15% or less), or quite high (1.5% or more) in the case of actively managed accounts or private investments. It’s good to know all the fees you pay on your investments, because what you don’t know could hurt your returns.
- Their approach to working with you is clear.
The last attribute relates to the process an advisor will use to work with you. An advisor should be able to explain how they will develop their relationship with you as well as share a complete roster of their services, including what you can expect in the earlier phases of your engagement as well as what happens over time.
Gender lens investing is of deep interest to many in the Invest for Better Community. A few weeks ago, abut 50 Invest for Better Circle members attended a special “Ask the Expert” session on Gender Lens investing, featuring Kristin Hull of Nia Impact Capital. In addition to sharing her personal journey on becoming a gender-lens investor and getting her firm to be Gen Certified, Kristin provided practical resources and guidance for how investors can incorporate gender into their goals and actions. For those who missed it, you can listen to Kristin’s talk here. We are grateful to Kristin for all her field-building efforts and contributions to Invest for Better!
Also last month was the GenderSmart 2021 Summit, a world class event (impressively offered in 2 world-sensitive time zones) of incredible speakers and participants representing the full ecosystem of gender lens investing. No worries for those who could not attend, because the website includes highlights and links to the fantastic resources unveiled at the event. High points for me included new data showing that assets with a gender lens have grown to $11 billion, a phenomenal increase since the term was coined only 12 years ago; Criterion Institute’s new white paper on Disrupting Fields: Addressing Power Dynamics in the Fields of Climate Finance and Gender Lens Investing; and simply the many voices and players in the gender lens field tuning in from all over the world. Invest for Better is delighted to be co-inviter to GenderSmart and VC Include’s upcoming Capital Connect and to offer our network discounted registration for this gathering to connect gender-lens investors with gender-lens funding opportunities. Please let us know if you want access to that discount!
It’s been almost 15 years since I met Jackie Vanderbrug (now at Bank of America/US Trust) and Joy Anderson of Criterion Institute who coined the term “gender lens investing.” That meeting launched me on a journey to transform my personal portfolio and ultimately – via Invest for Better – to advocate for all women to seize the power of the capital markets in service of a better world. I’ve had the privilege to meet and work with so many incredible leaders in this field over time, including Suzanne Biegel, Jacki Zehner, Tuti Scott, Tracy Gray, Vicki Saunders, Kathleen McQuiggan, Alison Pyott and many others. As a result of their work and investor demand, today there are an ever-growing number of gender lens funds and products available to retail, HNW and institutional investors. They have pushed the field to develop greater transparency and comparable benchmarks (hats off to Equileap and As You Sow). Through our collective insistence that gender is “material” to both financial and social/environmental outcomes, we’ve come a long way.
But we know that the fight is not over, by any stretch. While $11 billion in assets is a great big number, it pales in comparison to the overall market. Consider that Green Bonds alone came to $1 Trillion in 2020. The data is improving, but it continues to focus too much on counting the number of women and not enough on the risks of biased practices and policies, such as inadequate childcare. There are still too few male allies at the table, and the entrenched financial systems continue to disadvantage first time fund managers or enterprises led by women or BIPOC. Thus only 3% of venture capital goes to female entrepreneurs.
Invest for Better Circles have a role to play here. Through involvement in a Circle, you can learn about how to incorporate a thoughtful gender lens into your investing. You can confidently ask questions of your financial advisors about what they are doing to build a gender smart portfolio. You can collaborate with others to advocate for changes in national standards. You can be a champion to Invest for Better.
I enjoy the annual rite of reflection and planning that January brings. But wow, what a year it has been to look back on, and, as January unfolds in unprecedentedly volatile times, what a hard year it is for planning ahead. As a white, privileged woman with grown kids, whose work largely consists of sitting at a computer, I was spared any significant impact this last year. (In the big picture, does it really matter that my daughter had 12 guests instead of 240 at her wedding? No, and there’s a lot to recommend for it. ) Nonetheless, I am changed forever by what I learned about the deep inequities embedded in our society. I came away from this year with only a stronger conviction that it takes all sectors – governmental, philanthropic and market – to reshape our planet, economy and society. And despite all the challenges ahead, I believe that this will be a year of hope, healing and collaboration.
At Invest for Better it was a year of many silver linings. While the pandemic forced us to shift our Invest for Better Circle to an online format and Circle members missed the chance to be together in person, it also allowed the model to scale more quickly and widely. Volunteer leaders stepped up by the scores to launch Circles in our first global Cohort and recruited co-leaders and members from all over the country, and in Canada, the Caribbean and South Africa. The Circle model clearly met a felt need to be in community with other like-minded women and to problem solve together about how financial investments could make a dent on systemic issues such as racism and sexism. Circles were able to access awesome expert speakers who would not have been able to attend in-person meetings, drawing upon Invest for Better’s Speakers’ Bureau and their own personal networks. With the virtual model, Invest for Better was able to help Circle Leaders enroll members from our ever-growing list of inquiries, and to provide Cohort wide programming, such as “Ask the Expert” webinars on investment fundamentals and thematic investing.
The Cohort model also resonated with the 60+ leaders of 30+ Circles who met for monthly zoom calls, sharing tips, learning from one another and providing Invest for Better with valuable feedback on ways to strengthen and customize the model for a wide diversity of populations. I am humbled by their servant leadership, and by their willingness to volunteer their time and energy to bring more women to the table. We began to feel, collectively, that the movement was building.
So I dare to look forward with hope to 2021, for Invest for Better and for the world. The sustainable investing market continues to gain enormous traction, as evidenced by US SIF’s recent report and investors want to do more. At Invest for Better, we are launching a new Leader Cohort in April and invite all of you who care about using the markets for social good to join us. Be a champion and join our movement of like-minded leaders.
All Systems Go!
Thanks to our amazing cadre of nearly 60 volunteers, the first cohort of 35+ Invest for Better Circles are up and running. Our monthly calls with this global group of Circle Leaders have provided wonderful opportunities for sharing, learning, reflection and new ideas.
At each meeting, we have invited a few leaders to share their experiences in recruiting members, structuring their meetings and developing trust in their communities. While most Circle leaders have recruited all members from their personal networks (and most Circles have co-leaders so that means 2 networks), others have augmented their groups with women from the Invest for Better website inquiry list. While most Circle leaders offer membership for free, a few which are focused on high net worth populations ask for a modest membership fee and use the proceeds to pay speakers. Several leaders have emphasized the importance of taking time to build an esprit de corps and understanding among the group.
“I was a little intimidated by the idea of leading a Circle, but the first couple of meetings have been great!” –A new IFB Circle leader
Here at Invest for Better, we’ve been working to deepen the Toolkit curriculum for the Circles. Volunteers from the Steering Committee and elsewhere have created template presentations for each meeting. Thus far, we have tackled Impact Investing Overview, Public markets and Shareholder activism, and Cash & Cash Equivalents. Private Funds/Direct Investing and Real Assets are the remaining topics.
In response to demand, we also offered our first “Ask the Expert” session, featuring Steering Committee member Kathleen McQuiggan of Artemis Advisors, who delivered a standout session on Investing 101. Her straightforward, incredibly clear tutorial, along with a robust set of Q&A, can be found on the Invest for Better website here. We intend to offer more cohort-wide “Ask the Expert” sessions over the coming months.
“We worked at the beginning to get an understanding of where they each are in their journey and are trying to tailor the experience to them.” –A new IFB Circle leader
Join the Movement
We believe that we are reaching about 350+ women in this inaugural cohort and aim to reach 1000 in 2021. To that end, we are pleased to announce that we will launch a Winter Invest for Better Circle cohort in March and will actively recruit Circle leaders over the coming months. Please let us know via the JOIN US button if you are interested in leading or joining a Circle.
“We seek to create lots of conversation and community across the group; this is about sharing and engagement, not instruction.” –A new IFB Circle leader
At our last cohort call, one Circle leader posed the question “are we trying to create a movement?” Our answer. H@#$…. yes!. So, if you want to join our movement, if you want women to take control of their capital to shape our economy going forward, if you want women to sit at the table and craft the rules of capitalism, please JOIN us!
It’s okay for women to create personal wealth, understand financial management, start and grow businesses, run successful social enterprises, enjoy financial security and go beyond simply taking care of their livelihoods in order to build intergenerational legacies. None of this should be considered outside of our reach. And yet, even in the United States, for many women, and particularly for Black women, the impediments put in the way of achieving any of these goals often seem insurmountable.
The barriers can be quite daunting – structural bottlenecks, behavioral blind spots, and internal demons make it seem almost impossible for women around the world to build and create wealth on an equitable basis. Tackling these external and self-imposed challenges is an important part of my life’s work – and one of the reasons I chose to be a Steering Committee member for Invest for Better.
I regard it as an ethical imperative to solve the problems of sexist discrimination and structural disparities that plague financial markets, and I’m focused on breaking down barriers and bringing about positive change. I’m fortunate enough to walk this journey with allies, mentors, and mentees. Together we are designing strategies, tools, and techniques that will result in breakthroughs.
Our commitment to diversity and inclusion is not naïve. We recognize that there are different positionings, intentions, and mindsets of women across age, class, race, sexual orientation, gender identification, and national origin – thus, treating women as a non-homogeneous group is very important to our work. This is hard work and while we may make mistakes, we try to fix them and to continue moving forward with a learning mindset. As far as we are concerned, this is work that must be done, and we carry on mindful of the words of Maya Angelou: “All great achievements require time.”
In undertaking this work, we imagine success as a state in which women are enabled, have access to financial and other forms of capital, and have the wherewithal to use their assets to create useful goods and services that in turn increase human wellbeing and solve societal problems. We believe that if women succeed in this way, all of humanity will be enriched, and we will have more abundant, rewarding, and connected lives.
The situation we face is quite dire. Statistics tell a tale of women encountering legal, structural, and behavioral barriers in terms of access to capital, even in the United States. It is important to analyze what has led to this set of difficult circumstances so that we can plot a way forward and achieve the future desired state and the virtuous cycle that will emanate.
Women bear an unequal responsibility for domestic management roles, including cooking, cleaning, washing, child rearing, elder care, and many other important household tasks. These rigid role definitions and traditional divisions of labor and their effects on time means that women spend most of their non-economic production time on these activities. This leaves little time and energy to devote to financial management, retirement planning, saving, and investment for themselves and their families. Even as business owners, women are likely to rely on others for financial modelling and planning. Finance is an area where few dare to tread.
In many countries around the world, this patriarchal division of roles and responsibilities is hard coded and enshrined in law. Even in the United States, it was only in the 1960s when women were allowed to have bank accounts and undertake financial transactions like borrowing money without the accompanying approval of a man.
Women not only face disadvantages in their personal lives but also in the labor market where they are subject to widespread pay inequity in which men are paid more to do the same jobs. As business owners, particularly in countries where ecosystems to encourage and nourish entrepreneurship and innovation are not well developed, women are denied opportunities to fulfill their potential. In the United States, women business owners can access financial capital and support, but there is great disparity in the outcomes for Black, Latinx, and indigenous women.
In the finance and investment world, like so many other professions, women are greatly underrepresented at senior decision-making levels. And where there has been some progress in the United States, it has been predominantly for the benefit of white women.
These are systemic problems insofar as they arise because of the mindsets, mental models, values, and ways of being that shape institutions, which in turn, produce rules, practices, and organizations that interact at multiple and interconnected levels to produce dire outcomes for women. If we are to achieve success, we must tackle the systems – economic, legal, institutional – that produce these destructive outcomes. All of the levels are interlinked; complex factors influence and shape national and local institutions and then, working through cultural and social pathways of transmission, institutions exert influence extending into the personal and private spheres. There are psychic and emotional issues that must also be addressed if there is to be healing.
Invest for Better (IFB) is an initiative that builds up women by engaging them in their personal spaces, equipping them with the resources to encourage and enable values-aligned investing. It has the potential to be an important disruptor by providing models that challenge and confront stereotypes. The IFB community creates new social pathways by providing a space for women to spend time and energy learning about investment and experiencing themselves as investors – in Invest for Better Circles. The format allows women to exchange knowledge about finance and investment in safe spaces and without judgement. The pace of learning is self-organized and flexible, and the Circles are designed as open systems where there is ongoing interaction with experts from many different communities.
The 2020 effort to build a broader network of IFB Circles around the world has actually been helped by the disruption caused by COVID-19, as the all-virtual offering has greatly increased the racial and geographic diversity of the community. My contribution to IFB as a member of the Steering Committee is in keeping with my commitment to practicing innovation as a process of widening the pool from which we seek solutions. And I certainly look forward to learning from and supporting women as we venture into forbidden and foreboding terrains to create exciting and healthy futures.
Dr. Gillian Marcelle
Invest for Better is scaling up! Earlier this year, as we reckoned with the impact of the COVID-19 pandemic on our 2020 goals for Invest for Better, we presumed that this new reality would require us to temper our expectations and wait for the “next normal”. We worked to adapt our model for a virtual experience, and help existing Invest for Better Circles continue their important work.
However, when we put out a call for new leaders to join an inaugural cohort of Circles, we were stunned by the response – more than 60 volunteers stepped up to lead 40 Invest for Better Circles that will launch this month as part of our inaugural cohort! Circle leaders come from a variety of backgrounds and include individual investors, investment advisors, foundation trustees, academics, and activists. They range in age from their 20’s to their 60’s. They live primarily throughout the United States and Canada, but we also have a Circle in South Africa and one in the Caribbean. Fourteen Circles are led by one or more women of color, and while all Circles will launch in a virtual format, nearly half will focus on recruiting members in their local region. We are launching these new Circles as part of an inaugural cohort in order to:
- Help build community and accountability among the leaders through regular Zoom calls and an online Circle Leader Hub
- Gather valuable input on the Invest for Better model to help strengthen it and to build the resource library of materials for Circle leaders
- Enable us to evaluate the success of the model over a significant sample size
The enthusiasm of the new Circle leaders is inspiring! We held two Zoom calls over the summer to help new leaders prepare to launch their Circles and had more than 50 aspiring leaders on each call. It was amazing to see all their faces in the gallery and to get their insightful input through dialog and surveys. All 60 leaders have joined the online Circle Leader Hub and many of them are nominating amazing people for the Invest for Better Circle Speakers Bureau. We expect to reach about 400 women investors through this inaugural cohort and envision this as a model for future cohorts. We all have the sense that we are on the crest of a wave that will bring more women into the impact investing movement and shape the future of our global capital markets.
We are currently in a fundraising mode to help us as we scale. If you would like to support our movement, please consider making a donation. And if you would like to be part of future Circle leader cohorts, please let us know. We are incredibly grateful for your continued support of our movement to help grow and shape the future of impact investing through greater female participation.
Needless to say, the world has changed. While it is too early to assess the overall impact of the coronavirus pandemic, we see it revealing systemic inequities in all corners of society: health, education, housing, food security, employment, transportation, safety, and others; and we see the disproportionate impact it has had on women, people of color, and New Americans. We are face to face with the deep interconnectedness of our global community and the responsibility that all of us have for each other across states, continents, and sectors. And we are committed to ensuring that we do not go back to “business as usual” in the recovery phase of the pandemic, but instead use the hard lessons learned to help build a more inclusive, just, and resilient society. All of us can contribute to that vision, as donors, voters, consumers, and investors.
What does this mean for us at Invest for Better?
Our conviction in the importance of impact investing is stronger than ever. As Invest for Better Steering Committee member Suzanne Biegel noted in her recent Impact Alpha article: “That COVID-19 will reshape (and is reshaping) the global economy is inevitable. The question for all of us is what kind of economy do we want to create as we rebuild and reshape?”
Women need to play an important role in shaping the “after”, not only because women are so deeply affected by the failures of yesterday, but also because we weren’t at the table when the old economic rules were made. We know that women (and many, many men, too) value principles of investing that go beyond short-term profit maximization. They care about the purpose of money and its value to the community, but too many have stayed on the sidelines. Now is the time to step up. As one of our Invest for Better Circle leaders asked, “How do we galvanize more women of conscience to come together, use the power of their investment assets, and have their voices heard?”
Invest for Better is adapting to the new conditions in exciting ways.
- Invest for Better Circles are going virtual. We have just published an Invest for Better Circle Toolkit Supplement about how to hold virtual meetings and run virtual Circles. We are hearing positive reports from leaders of existing Circles who have migrated to online platforms for their meetings, and leaders of new Circles that are launching in virtual mode are pleasantly surprised by the success of the experience. The Supplement provides advice to Circle leaders on building community, intimacy, and trust, along with practical tips on how to modify agendas and activities. We imagine Circles of the future will be a mix of virtual, in-person, and blended.
- Among the advantages of virtual Circles and meetings is the ability to bring in expert speakers from anywhere in the world. Invest for Better has developed a Speakers Bureau, composed of individuals with expertise across asset classes and other impact investing specialties (e.g., Sustainable Development Goals, metrics, money values). We are thrilled to welcome these generous professionals into our community and be able to offer their expertise to Circles at no cost.
- We recently conducted a survey of nearly 50 current and aspiring Circle leaders to find out how we could better support the launch or ongoing work of Invest for Better Circles. In addition to asking for guidance on running virtual Circles, respondents indicated a desire to build community among Circle leaders, namely through three strategies: Calls or video-chats to talk with other Circle leaders, an online community to share resources, and a “cohort” of Circle leaders who are on similar schedules. We are working on building out these services.
- Finally, we are exploring how to respond to the call from Circle leaders and participants, as well as partner organizations, to bring together our voices and actions for change. In the Boston area, we are convening interested women to share learning and ideas for addressing – through investing and philanthropy – structural racial inequities revealed by the pandemic crisis. Nationally, we were part of a conversation with Mayshad CHOICE’s Women and Money series on the role of women and impact investing in today’s crisis. We are in conversation with partners about creating a series of webinars to help individual investors and advisors explore what you can do now while we’re in the midst of chaos, what you can do later when the path to recovery begins, and how you can contribute to the reform we need in the long term.
Let us know what you need and how Invest for Better can support the conversations you are having about ensuring a focus on sustainability, equity, and resilience in our capital markets. Let’s bring more women to the table. If not us, then who?
At Invest for Better we seek to curate and share with our community the best, most accessible resources about impact investing that have been created by our colleagues in the field. But sometimes there is a gap and we step in to fill it.
Many of the women in the Invest for Better community are highly experienced philanthropic leaders, but new to using their investments as a force for social change. They have often deployed smart, focused philanthropic giving to support innovation and experimentation in their focus areas, to fill a gap in services that should be covered by public money, or to bring together stakeholders to learn and collaborate. But they may be frustrated by the limited ability of philanthropy to scale proven solutions. Or perhaps discouraged by the absence of sustainable funding for an essential program. They are intrigued by the idea of turning to the capital markets and their own investment capital to address these challenges, but don’t quite know how.
It is for these women that we created our new workbook, Amplifying your Philanthropy through Impact Investing, with generous support from Fidelity Charitable. Aimed at helping the philanthropist who is a newbie impact investor develop plans for both learning and action, the workbook guides users through 6 questions to help identify possible ways to use investing (personal, retirement, foundation, or donor-advised fund capital) to increase their impact on the people, places, and issues they care about:
- What are your philanthropic goals?
- What source(s) of capital do you want to use for impact investing? How much capital do you want to start with?
- What are your financial goals for each capital source?
- What impact investment solutions or tools might help you achieve your philanthropic and financial goals?
- How will you decide which impact investments to pursue? What criteria and due diligence processes will you use?
- How will you measure the success of your investments?
The workbook includes a concise primer on impact investing along with numerous examples of impact investments. It is intended to serve as a starting point for developing an impact investing strategy to augment one’s philanthropy, and could be used in consultation with financial, philanthropic, and other advisors. (Stay tuned for an annotated version of the workbook that advisors can use with their clients.)
The fundamental purpose of Invest for Better is to help women bridge the activation gap between their avowed interest in purpose-driven investing and the reality that only half of the “persuaded” are activating their assets in alignment with their values. We believe that women philanthropists are poised to narrow that gap and only need to develop the knowledge, confidence and support for implementation. We invite interested women to join our growing movement of Invest for Better Circles and/or to use this new workbook as a jumping off point for discussions with their advisors
Research conducted by the Women’s Philanthropy Institute found that women are more likely to use impact investing to complement their charitable giving, while men are more likely to use impact investing in place of charitable giving. This is important information and points once again to the need to focus on growing the number of women impact investors. Philanthropy plays vital roles in our civil society that cannot or should not be replaced by the capital markets. And capital markets play an essential role in scaling and sustaining solutions. We need all types of capital – philanthropic, impact-first, frontier, and market rate – to tackle critical issues facing our planet, and an ecosystem of smart investors who know how to use all the tools in their toolbox. We hope this new workbook contributes to that vision.