Category Archives: Social Finance

“Investing” in your savings account?

RRSP Season is here, are you saving wisely? In this article by MoneySense, we learned that a “whopping 60% of the typical [Canadian] portfolio is being held in cash–far too much to meet most retirement needs when you factor in record-low interest rates and inflation.”

This trend seems to be mirrored in ZooShare members as well: When asked, “Not including ZooShare, where do you invest?” 56% of ZooShare investors said “In my savings account”.

In the MoneySense article, when people were asked “why [they] were sitting on so much cash, the majority cited accessibility and/or convenience”.

Well, we’ve made it easy for you: Here’s a list of 3 resources to learn how you can align your investment portfolio with your values and perhaps earn more by becoming an impact investor.

Disclaimer: we are not legally allowed to offer financial advice, so please do your own research and speak to a professional. These suggestions are just starting points!

1) Read this:

The Responsible Investing Association recently published their Guide To Responsible Investment. It’s available online and chockablock full of great articles like “Climate Change and Responsible Investment” (page 12) and even features a list of Responsible Investment Funds (page 23).

2) Research these:

Since 60% of ZooShare members also invest in Mutual Funds, we thought it would be useful to share these recent developments:

NEI has recently announced plans to launch a new fund called the NEI Environmental Leaders Fund. The fossil-free fund will invest in companies providing solutions to environmental problems (focusing on energy efficiency, alternative energy, waste management, water, and sustainable agriculture).
IA Clarington’s Inhance Global Equity SRI Class has divested from fossil fuels.
OceanRock’s Meritas SRI Funds are the only mutual funds in Canada with an impact investing component. A portion of all portfolios is allocated to “Community Development Investments”. Read more here.

In addition to the funds listed above (and in the Guide), here are EVEN MORE responsible funds you can talk to your financial advisor about (if you have one) or research yourself. PS: If you don’t have a financial advisor and you’re looking for someone who knows about responsible investing, the RIA has an online directory of advisors.

3) Buy a Community Bond!

And of course, ZooShare is now offering a new series of bonds that are construction risk-free and earn 5% each year for 5 years. Help generate renewable power, reduce greenhouse gas emissions, and return nutrients to the soil. You can learn more about our newest bond offering by clicking here. There are also other options to diversify your community bond portfolio, like:

Happy responsible investing this RRSP season!

Blog: Help to Crowdfund CaribShare

Hello ZooShare supporters,

I would like to share a letter with you from one of our friends, Carol Lue of CaribShare Biogas. Carol is a fellow-entrepreneur and biogas developer, located in Jamaica. Drawing inspiration from ZooShare’s business model, CaribShare will use biogas technology to produce renewable power, reduce poverty and take action on climate change. They have enough funds to cover 85% of the construction costs for their pilot project, but they need your help to raise the last $20,000. If you are inspired by Carol’s work, we urge you to support CaribShare’s crowdfunding campaign. Please read Carol’s letter below to learn more.

Thank you,

Daniel

Support CaribShare Biogas-HD from Carol Lue on Vimeo.

Dear ZooShare members,

Unexpected wins are one of the joys of being an entrepreneur.

I am the Founder and Executive Director of CaribShare Biogas, a social enterprise and registered charity in Jamaica. A few weeks ago, I was honoured to speak at a Virgin Unite event in NYC to celebrate the launch of the Global Goals for Sustainable Development (there are 17, covering poverty, inequality and climate change). As CaribShare touches on several of these goals, this was indeed an unexpected win and an amazing highlight to share our story there. I was especially honoured to also share the platform with Sir Richard Branson himself who has inspired me and so many other entrepreneurs to use business as a force for social good. Our mission is to produce clean energy in a way that reduces poverty and allows us to take action on climate change.

In partnership with Ch4 Biogas in Ottawa, we are developing and operating the first biogas plant in Jamaica to generate electricity on a sustained basis. And, drawing inspiration from ZooShare’s business model and developing a partnership with ReGenerate Biogas, we are working with the hotel and small farming communities to deliver biogas solutions to the entire Caribbean region in a socially impactful way.

What We Do

We collect tremendous quantities of food waste from hotels and animal poo/manure from small livestock farms to produce biogas (type of biofuel) and organic fertilizer for sale.

The biogas is sold to businesses that are high energy users so they can self-generate electricity at a significantly lower cost than purchasing from the grid. And, the fertilizer is sold to farmers at a highly discounted rate to help lower their production cost and promote organic farming.

We then share up to 50% of our surplus revenues with our participating farmers as meaningful income to help support their livelihood and the vitality of their communities.

Our Current Project

Construction of our pilot 100 kW biogas plant in Montego Bay will be completed next month. It will process organic waste from the Sandals, RIU, Iberostar, and Half Moon Resorts as well as from 50+ small pig farms in the surrounding areas. The biogas will be used to generate electricity to help power a highly energy intensive sewage treatment facility.

My Path to Launching CaribShare

Bringing CaribShare along over the past 3 years to launching next month has been both extremely rewarding and challenging. Continuous ups and downs and incredible struggles have been faced: raising capital with limited collateral, negotiating the bureaucracy of getting our environmental permit approved, and negotiating both the seen and unseen political and competitive dynamics that come with developing a pioneering venture that is both a waste and energy company are just a few examples.

But despite these challenges, what has kept me going, beyond my confidence in CaribShare’s business model and my own personal resilience, is the clear vision that I have for CaribShare to grow and deliver clean energy in a socially impactful way across the Caribbean.

Growing up in rural Jamaica, I felt so blessed to be close to nature and to have that connection. But, I was also affected by the poverty that was around and the struggles that good hardworking people were facing. I also felt that it didn’t have to be so, and I was determined to help from then.

Fast forward many years later to 2012 after having left Jamaica to study and having worked in business and sustainability for about 15 years in Boston and Toronto, that opportunity arose. Having just been laid off and looking to begin the next chapter in my life, I entered the proposal for CaribShare into the IDEAS Energy Innovation Contest that was being sponsored by the Inter-American Development Bank. And, out of 3000 proposals, CaribShare was one of the lucky 8 winners. And, as a result, I gladly moved back to Jamaica.

From the competition, I was awarded a $200K grant which I have been leveraging to raise $600K to launch CaribShare’s pilot thanks to funding assistance from Caricom Energy Program, GIZ (German Corporation for International Cooperation), and the Development Bank of Jamaica.

The Way Forward

Amazingly, our biogas plant will also be the first in Jamaica to generate electricity on a sustained basis, which is a significant contribution to solving the energy woes of Jamaica and the Caribbean. Plus, we will be diverting immense quantities of organic waste from landfills for clean energy generation and rural development. And, I can clearly see developing up to 6 of these centralized 100kW generating biodigesters in Jamaica before expanding to other Caribbean countries that also have a lot of hotel and farm waste.

But, this excitement to expand comes with sobriety in knowing that I am going against the odds in developing CaribShare from the ground up. Luckily, my supporters have remained committed despite my struggles and lengthy delays in launching the pilot because they too support the vision and see my persistence. And, through divine intervention, somehow I have been brought in touch with persons in crucial moments willing either to offer some meaningful intervention or to be truly collaborative. So, despite the never ending exhaustion that I feel as an entrepreneur, I have a tremendous amount of gratitude, optimism, and certainty in knowing that with the right connections, partnerships, and collaborations CaribShare will be unstoppable in improving people’s lives. And, yes together we can all make the Global Goals come true.

We have launched a crowdfund campaign to raise additional funds to successfully implement our pilot, which can be found here . To support our social impact, contribute to our fund, share our campaign link, and like our facebook page. Thank you for your support, and I would love to hear from you.

Sincerely,

Carol Lue

Founder & Executive Director, CaribShare Biogas

Blog: Member Spotlight: Betty-Anne Howard

ZooShare investor Betty-Anne Howard is a “financial planner with a social conscience”, meaning she cares about the environment, the world, and how people make their money. While in school, Betty-Anne learned a new way to see the world, and now she passionately champions protecting that world through the UN’s Principles for Sustainable Investment.

When did you become passionate about the environment?

I’ve always been passionate about the environment…Part of that was because I had to be: We grew up poor, we didn’t have a lot, so we had to reduce, reuse and recycle out of necessity! In the early 80s, when I was in my late 20s, I learned about and developed a feminist construct that allowed me to see the whole picture…What I learned through feminist theory was respect, power…and care for the community and other communities, and that strengthened my passion for the environment.

Why did you decide to invest in ZooShare?

ZooShare sent out a post to the members of the Responsible Investment Association (RIA) asking impact investors to share their stories. As a result of [Frances] reaching out to me, I decided to take a closer look, and I thought “this is something I could really get into”. I’m a big believer of practicing what I preach, like my involvement with the RIA and micro-enterprise lending through KIVA…It just made sense to me, especially with the 7% return, I thought “I would like to get behind ZooShare”.

What are some projects you think other ZooShare supporters would be interested in?

There are many things that are happening out in the community, as well as some things that are unique to Kingston. For example, I’m part of a a group that’s associated with Wintergreen Co-op…and I’ve been a member of SWITCH for about 5 years…

Wherever I go and whatever I do, I look for opportunities to talk about the environment and to talk about issues related to being socially responsible…For example, in my work, I wanted to hear from money managers, to what extent–if at all–we were implementing the UN Principles for Sustainable Investment, because, Environmental, Social and Corporate Governance issues (ESG) form the basis for Socially Responsible Investing (SRI). I spoke with [one of my managers] about [implementing SRI principals and] he was completely behind it, he was prepared to send out a memo about it…and later that week, he received a memo from [the parent company] asking for the same type of transparency! I was excited and thrilled and so proud of [the parent company]…My ideal goal is to not have a separate group of funds called SRIs, I want these principals to be completely integrated in every part of every portfolio manager’s investment decisions…That’s my dream.

Blog: Community Bonds Factsheet

Looking to make the world a better place while growing your money?

According to a recent report from the Responsible Investment Association, more than $4 billion has been allocated in Canada to “investments made into companies, organizations, and funds with the intention to generate a measurable, beneficial social and environmental impact alongside a financial return”. This definition speaks to the notion of a ‘blended’ return whereby investors are rewarded with both a financial return AND a social / environmental impact. It’s a clear win-win-win for the economy, society, and the planet.

Community bonds can enhance any portfolio by offering a strong return on investment, while hedging against systemic risks that could affect the entire stock and/or bond market. Since community bonds aren’t traded on any exchange, they will remain stable in the event of a crash. Community bonds do come with some unique risks, and investors need to do their homework before investing.

So how can everyday investors like you and me get in on this action? Thankfully, three leading organizations have teamed up to present a quick factsheet that outlines their community bonds:

I love the content of this factsheet, and what excites me the most is the collaboration it represents. All too often in the investment industry, I’ve seen organizations competing against each other for your (or my) money. It’s refreshing to see that these nonprofits, instead of competing for a bigger piece of the pie, are collaborating to make the whole pie bigger! This speaks volumes about the culture in the social finance sector, and provides a stark contrast to the cut-throat nature of the old investment banks.

My hope is that investors will stop asking ‘should I or shouldn’t I?’ around community bonds and start asking ‘what percentage of my portfolio should I invest?’. If Canadians allocated just 5% of their money into community bonds, it would activate more than $50 billion of capital to help the nonprofit sector grow and thrive. Now that’s a sustainable economy!

Want to learn more? Get your tickets to the Community Bond Showcase happening March 19 6-9pm at CSI Annex (720 Bathurst, just south of Bloor).

**DISCLOSURE – The author is a member of both SolarShare and CSI and is about to join ZooShare**

This post was written by Timothy Nash and was originally posted on The Sustainable Economist blog. It was re-posted here with permission.

Blog: Member Spotlight: Don Ross

Don grew up in North Western Ontario where the outdoors was his playground; As a pilot, he witnessed the sky being used as a garbage dump; Last year, he and his wife Heather only threw out 3 bags of garbage.

When did you become passionate about the environment?

There isn’t a particular moment that I can say I became passionate about the environment, it’s been a part of my life since I was young. I grew up in North Western Ontario, the outdoors were my playground: Fly-fishing in the rivers, camping in the woods, playing in the snow…It gave me respect for the power of nature…And if anybody has ever gone winter camping in Canada…it certainly teaches you to respect the power of nature!

In high school one of the class projects was doing a documentary about what was important to you. Mine was an exposé about the pulp and paper mills that I grew up around in Fort William. I put it to music and tried to show how we were using the sky as a garbage dump, pumping all this pollution up into the sky. Not too long after I finished high school, I got my aviation licence: Flying around Thunder Bay, I saw a many factories and mills that reinforced my view that we were treating our air and atmosphere like a garbage dump. It made a very strong impact on me.

If I had to pick a particular moment when I became more involved as an adult, it would be around the turn of the century: Prince Edward County was going to be first County in Ontario to have wind-farms, and having lived there since 1980, we certainly knew we had a tremendous wind resource here! The people that were opposed to the wind farms were getting a lot more attention than those in favour, so I founded Citizens Advocating for Renewable Energy (CARE), which gave a voice to the silent majority who supported wind power.

In 2005 my wife Heather and I were some of the first in Ontario to receive the Renewable Energy Standard Offer [the predecessor to the Micro-fit program] in which people were given the opportunity to sell power to the grid. With Bullfrog Power we paid a small premium in order to source our energy from wind and small run-of-river (hydro) projects. We put solar panels on our roof and added more panels after the Micro-fit Program came in. Together, with the solar hot-water we added, it made us more conscious of the power we were consuming and how it was being produced.

Around that same time, An Inconvenient Truth came out, and that’s also when our 1st grandchild was born…That was my driving force from that point on…When you have grandchildren, that changes everything. I always visualize my grandchildren being my age, 60, what kind of world will we have for them? We have to do things that will make it a better world for them and for their parents.

Why did you decide to invest in ZooShare?

ZooShare fits with what we think is right. We feel like we have to set an example, and leading by example is the best way. I think it was Ghandi who said “be the change you want to see in the world”. If you want something to happen, it’s you who has to make it happen. Rather than just wishing things were different, make them different.

For us, ZooShare was a perfect way to get involved, we really love the idea of making use of waste products. Our society needs to manage our waste better, what better way than making clean electricity from it?

7% is a wonderful, very attractive return on our investment, so for people that are more focused on the financial benefits, you can make some green for yourself while producing green energy. For us it wasn’t as much about the return as much as it was about being a part of an innovative, creative and positive environmental project with high-visibility: We like that [the ZooShare biogas plant] will be in a public place (at the Zoo) where millions of people will see how energy is produced. It will trigger thoughts about how energy is made and consumed. Now, I don’t think energy production is something that most people think about, we all take it for granted.

We were also very attracted by the teaching element of ZooShare. I know we’ll be taking our grandkids to the Zoo again, and we’ll be able to point to the plant and say, “we helped to make that happen” and “we can make the world a better place”.

Finally, we were very impressed with the professionalism of the team and how our questions were answered. We had the good fortune of knowing Petra [who sits on the ZooShare board] and Daniel [ZooShare’s Executive Director] was wonderful in answering the questions we had. We would recommend to anybody that they get involved in ZooShare and buy bonds.

What are some conservation projects you think other ZooShare supporters would be interested in?

Water conservation is very important to us. I helped start County Sustainability Group. Every year we raise awareness about water conservation through the sale of rain barrels, which coincides with World Water Day. Rain barrels create an opportunity for people to think about where water comes from, and what an important, scarce, and rare resource water is and that we really need to treat it with respect. We use the proceeds from the sale of rain barrels towards a bursary for students in Prince Edward County who show an interest in studying environmental sustainability.

Heather and I have always been thrifty, not wasteful…One day, on garbage pick up day, we suddenly realized how many bags of garbage people were putting out…We couldn’t remember the last time we did that, so we decided to keep track…It was quite amazing: we only put out 6 bags for the whole year! So I wrote a column about that for the County Weekly News and challenged people to reduce their garbage by 50%. That year we reduced our own waste from 6 bags to 3. We do that by practicing ‘Refuse, Reduce, Reuse, Recycle and Rethink’. ‘Refuse’ and ‘Rethink’ are the ‘silent Rs’: ‘Refuse’ is to be a smarter consumer: consuming less is the very first step. You have to decide between wants and needs. ‘Rethink’ is to think about everything you’re doing and try to find a better way to do it. It’s never being satisfied that you’re doing the best you can, because there’s always a way to do it better.

Another area that I think a lot of people could think about doing to take better care of the planet–and themselves– is gardening. When you think about our parents during the war, everybody had gardens, it was essential, there’s no reason why anybody who owns property could not have a garden of some size, shape or form. Since I’ve retired I’ve ben carving up my lawn and using more and more garden space and growing our own food. It’s better for you, and it’s an amazing way to keep yourself in good condition, you know where your food is coming from, and you reduce your carbon footprint (instead of buying food that is being transporting from everywhere around the world, you’re going out to your backyard). There’s instant gratification in having your own garden because you can pick it and cook it fresh right away. It also increases your own food security, knowing you can grow it and store it and have it there when you need it. You can also support your local organic growers and farmers, CSAs and community gardens, and advocate for bees and pollinators that are being devastated by neonics.

Gardening is also a great tool for the next generation. it’s a skill that kind of got lost after our grandparents, but when kids see it, they are amazingly interested in how things grow. There’s nothing better than taking my grandkids to the garden. In our generation, people have a consciousness of what we are leaving behind…it makes your decisions easier, it makes you think, “it’s not about me it’s the people who follow us”.

About ZooShare

The ZooShare biogas plant will recycle manure from the Toronto Zoo and food waste from Canada’s largest grocery chain into renewable power for the Ontario grid. This process will reduce greenhouse gas emissions by the equivalent of removing 2,100 cars from the road each year, and will return valuable nutrients to the soil in the form of a high-quality fertilizer. To build this project, we are selling bonds that earn a return of 7% each year for 7 years.

If you are a ZooShare member interested in being profiled for our Member Spotlight, please email Frances for details.

Blog: You know the TSX. What’s the SVX?

The Toronto Stock Exchange is Canada’s biggest stock market — if you’re an investor with Canadian mutual funds, stocks, or bonds, your money is probably there. But for accredited investors who want to make a social and/or environmental impact, there is the SVX. The company that owns and operates the Toronto Stock Exchange, TMX Group Inc., has been a longstanding collaborator on the SVX project, providing support since the concept was first developed in 2008.¹ The SVX was conceived to “create a market for good”. I sat down with Tristina Sinopoli, Project Coordinator at the SVX, to learn more about the organization and Tristina’s own experience in the world of impact investing²:

What is the SVX?

“The SVX is an online impact investing platform designed to connect ventures and funds that have a social or environmental impact in the work that they do, with investors that have expressed an interest in investing in companies that really do meet that double bottom line or triple bottom line, and vision.”

And for people who are unfamiliar with the “double bottom line” or “triple bottom line”, how would you define those terms?

“Companies that go above and beyond what’s expected of them by law to actually ensure that they’re having a very strong social or environmental impact. And what this really means is that they’re intentional about their impact. So they set out to actually overcome a problem that they see exists, whether it’s an environmental problem or a community problem…and they’re very intentional about saying ‘we’re going to use our business solution to solve that particular problem.’ So it’s not that impact is just a wonderful by-product of the work that they do, but they’re actually saying ‘we will be impactful and we’re integrating that, from top down, bottom up, throughout the entire organization’.”

Can you talk about some of your favourite victories or successes at the SVX?

The launch of the SVX was huge. Adam Spence had been working on the SVX…I would say, in total about 6 years…From ideation, to the pilot, to the demonstration. It was a really long journey for him in terms of getting the regulators on board, allocating all the right resources, building-up buying with all of our tremendously supportive partners like TMX, RBC, Rockefeller Foundation, the Government of Ontario, and quite a few others…So the moment when we received approval and the moment when we all realized ‘we’re live, and this has been done, and now we’re this existing entity and now we can do the work that we’ve wanting to do for so long’…It was an epiphany, a ‘we can do this and we’re on the ground doing it’ type of moment.”

I understand that the SVX usually deals with accredited investors, but are you open to being approached by individuals who would like to learn more about impact investing?
“100%. 150%.”

So what would a preliminary conversation look like?

“We would really be talking about common definition of impact investing. What we find is that a lot of individuals have come across impact investing at one point or another, it just wasn’t labeled ‘impact investing’, or it was labeled ‘social finance’, which is yet again another common term…We would talk about examples that are close to home and close to the investor’s frame of mind so that they would be able to relate to and understand what impact investing is. For instance, if I met with a family or individual that had generated wealth through some type of agriculture business that they were involved in, I would talk about the various impact investing examples that I know of in the agriculture space…Sometimes it’s a learning focused conversation, but sometimes they actually do know the examples really well, and we can talk about how that was an impact investment, and what the intricacies of those investments were.”

How did you become involved with the SVX team?

“Great Question! I studied at York University at the Schulich School of Business and I focused my studies within the financial market sector and I took a lot of courses in private equity. But while I was doing that, I took a lot of courses in Urban Planning and Environmental Studies, those were my passions, and they gave me that trigger moment to say ‘I want to do something with my business degree outside of the traditional investment banking or accounting’…I was the person in business school that always said: ‘what about their employees? And what about the environment? What about some of these horrendous outsourcing practices that we see multinationals doing?’ I wanted to use business in a way that would make me feel really good about what I was doing and also to help companies that I really believed in…I learned about MaRS in a happenstance type of situation: Investeco presented in my private equity class and they were talking about how there was this growing momentum of investors that wanted to invest in their Sustainable Food Fund because they [the investors] believed in it. And I thought, that’s the line that I want to go with, and I started researching MaRS and learned more about it…I started at the centre as an intern…I joined the SVX team in late 2012.”

“Impact Investing” was coined in 2007. Do you feel impact investing is still in its baby stages right now?

It’s very nascent. It’s not in baby stages in terms of everyone still trying to figure out what this beast is, it’s now about trying to figure out who it’s most appropriate for, and which investors want to get on board…It’s nascent in that there’s still not a lot of people doing impact investing. But with [newness] comes a lot of great advantages…It’s very easy now to look to leaders in the space and say ‘I want to join this space, how do I do it?’…Especially if they are a foundation, they can look to leaders like the Hamilton Community Foundation and the J.W. McConnell Family Foundation. The same goes for individuals as well as institutions, [for example] RBC has their Impact Investing Fund.”

What about outside of Ontario, what are the global trends in impact investing?

We’re definitely involved in the global conversion. We’re a part of the G7 Taskforce on Social Finance. We have a roundtable that convenes every so often with the goal of creating policies and frameworks that can help guide the impact investing movement forward globally…One of the things that we’re seeing is that the UK is very well ahead when it comes to social finance…[For example] social impact bonds were piloted in the UK…I would say they are the leaders in the space, especially the work that Sir Ronald Cohen has done to really build the market in the UK. And then we see various countries are ahead in different portfolios, so some countries may have really well-developed agriculture-type impact investing policies and procedures that are in place…Impact investing is so contextual that what it means in one country can mean something totally different in another country depending on both the domestic impact as well as the global impact.

Can you tell me about some of the trends you’re seeing in impact investing that relate to gender?

I can speak to what I’m seeing generally in the impact investing market in Ontario when it comes to gender…I’ve dealt with many families, so many males and females, husband and wife teams that are really interested in impact investing, or alternatively, a daughter and father or a daughter and mother, and so I would say that I’ve dealt with a 50/50 split of males and females…In terms of the female presence, we’re definitely seeing, at least from my experiences, that more women are involved in impact investing than in your traditional private equity VC space investing. And I think that the reason for that comes from a lot of female entrepreneurs or female executives that have recognized the potential of impact investing and the ability for them to actually use some capital in a really innovative way. So a lot of female entrepreneurs that have done work in the health care space, for example, then say, ‘I want to be able to invest in it, and actually put dollars towards a project that is similar to the company that I created myself’. And the same with the foundations as well, with foundations, we see a lot of female leaders in foundations that are leading the charge, a lot of executive directors in Canada are female, and so we do see huge momentum from women…[In a MaRS Women in Venture Capital and Private Equity study the high-level summary] was actually quite surprising: Females in venture capital and private equity usually take more of an administrative role, and are not necessarily involved in the investment decision making. That’s something that hopefully, when we have more data on impact investing, we can counteract and say, ‘well actually, when it comes to impact investing funds, the case is much different.’ We don’t have those numbers yet, and that’s something as a centre we can definitely work towards…I guess the other point that I would add as to why we’re still not fully ahead when it comes to the gender gap in impact investing, is that a lot of the investment professionals come from the traditional market, and so it is kind of a mirror-image…Obviously that can change and I foresee that developing as there are more women entering the traditional market as well, but I think that is something to keep in the back of our minds, that these are not just new investment professionals that are coming to light because of impact investing, there’s a fragment that are, but impact investing falls within the entire financial services ecosystem and so it’s important to understand that system as a whole, and to understand how we can support women across that entire system…One of the points that I would add is that even within the impact investment sector, it’s important to talk about female investors and female leadership, but it’s also important to talk about females as leaders in roles within the social enterprises that they operate in: That’s representation on the board for example, and that’s something we’re very cognisant of while we work with companies that are within the impact investing space, to ensure that they are really living the values that they are talking about, and many of them, if not all of them, are. For example, a company like ZooShare, I know that Daniel is very forward thinking when it comes to female leadership and that’s his own personal prerogative as well.

Did you learn about impact investing in business school?

When I was in university, the terms ‘impact investing’ and ‘social finance’ were not used whatsoever. The term ‘social responsible investing’ was, but it was used more-so in the sense of publicly listed companies and applying an ESG [environmental, social, governance] lens to that particular portfolio of investment. When I was at school there was 1 course on social entrepreneurship, and it was taught at a very high level…I felt that the instant I graduated, the course offering at Schulich increased to include impact investing and more social entrepreneurship courses…I think it’s important that impact investing is embedded throughout all courses that are business focused…as well as sector-specific focused courses…If you are in Environmental Studies, you should be able to understand the different financing mechanisms out there that can help you finance an idea that you might be working on…that’s critical. Impact investing is the definition of interdisciplinary work.

Do you have any tips on how to increase people’s awareness of impact investing in general?

Talking about it more. The investors that are currently doing it, should be talking about it as much as they can, obviously, not providing the sensitive information of their investment or anything like that, but actually being able to say “I invested in this really cool company, it’s very different than what I normally invest in”. When I meet colleagues I’m constantly talking about the work I do and trying to see how it relates to their life, for example if they work at RBC, I say, did you know RBC has an impact investment fund, have you ever heard of what they’re doing at the other end of the bank? And the more we can create those points of interaction where people can say “wow, this has actually touched my life in one way”, then we’ll have more people. On the inverse, not just from the customer perspective, but companies continuously telling their story and talking about why they’re different.

What do you think the future of impact investing future looks like? I read a great article about the future impact of millennials and impact investing.

When I think about myself and I think about the values that I have and the kind of investments I look for in my own portfolio, it’s very aligned with the person that I am…I think that [the future of impact investment] would be two routes developing at once: So the first component would be millennials aging who are accumulating wealth and looking for products that are much better at telling their own story, and much better being able to say ‘if you have values aligned with this particular sector, we’re the investment for you because those are our own values too.’ But I also wouldn’t discredit the older generation of current investors that exist…I mean, my parents have values too, and if they knew more about what they could invest in, they would do a lot more of it.

Resources:

1) http://svx.ca/about/partners
2) Personal interview with Tristina Sinopoli recorded 2014/07/29

Blog: From Ethics to Impact: The History of Making a Difference with Dollars

Although the practice of Impact Investing is relatively new (indeed, the term was only coined in 2007)¹, the concept of using one’s money to make a difference has been around for a long, long time. But it didn’t start with a triple bottom line philosophy…The movement began more as a way to avoid evil: In relatively modern history–the 1700s, to be more specific–Methodists began avoiding investment in industries that were considered to be harmful, like guns, liquor, tobacco, and gambling². (In later years, these became known as “sin stocks”.)

“Sin stocks” were not supported by Methodists and other religious communities.

Now fast-forward 200 years: It’s the 1960s and a modern era of investment has begun, interestingly, it is also strongly rooted in faith. During this era, Toronto became home to the Taskforce on the Churches and Corporate Responsibility (TCCR), a coalition of Canadian churches and religious orders. It addressed Canadian corporations, the Canadian government and international institutions on issues of corporate, social, and environmental responsibility. By supporting the member organizations to communicate their concerns (aka “shareholder activism”), the Taskforce helped to convince Canadian companies to pull out of South Africa during apartheid, and pushed a company in British Columbia to publish the first environmental report by a publicly traded company.³

The Taskforce also assisted churches in examining their own investment policies and practices³: Whereas the Methodists of the 1700s had avoided investing in certain industries by screening them “out”, known as “negative screening”, the 1960s and ‘70s saw a new development in the screening process: “positive screening”, the process by which companies were screened “in” for meeting certain standards. Negative and positive screenings were generally referred to as “ethical investment”. As well, some religious communities and churches sought ways to invest directly in community-based projects. For religious communities, this was a new development for the ‘alternative investment’ movement–“Or what now’s called the ‘social impact’ industry,'” says Moira Hutchinson, board member of the Canadian Alternative Investment Cooperative. (Side-note: This is a rather amusing example of how language changes over time, in 2014 “alternative investment” now “includes hedge funds, managed futures, real estate, commodities and derivatives contracts”⁵.)

Moira was one of the key members of The Taskforce and is also a recipient of the 2013 Canadian SRI Distinguished Service Award. She further explains how the screening process was refined over time:

“We were looking for the companies that were the ‘best of sector’, for example, looking for the mining company that was doing the least damage… …We wanted to figure out how to pick out the companies that were the best in a range of factors that could be measured, not just environmental impact, but diversity of employees, diversity on the board of governance…that was the approach that became fairly standard among ethical investors at that time.”³

Moira acknowledges that over the years “there hasn’t been a lot of opportunity for individual investors to invest in alternative…Or social impact investments.” But there is hope for the future: “It’s only in very recent years that, with the whole concept of ’impact investing’…That there will be more opportunities for people to invest in those kinds of investments, and without having to have substantial amounts of money.”

Now we have better than “best-of-sector”. Companies that offer impact investments are not doing the least damage, but aim to do the most good. These companies exist to monetize their mission, to do good and make money doing it. And you can join in.

(Shameless plug: For $500, you can invest in ZooShare and earn 7% each year for 7 years, while generating renewable energy and cleaning the air.)

References:

1) Financing Social Good: A Primer on Impact Investing in Canada. Toronto: Purpose Capital, RBC, Mars Centre for Impacting Investing. Pg. 5. Retrieved from: http://www.rbc.com/community-sustainability/_assets-custom/pdf/Financing-Social-Good.pdf
2) http://wesley.nnu.edu/john-wesley/the-sermons-of-john-wesley-1872-edition/sermon-50-the-use-of-money
3) Darwin, Frances. Personal Interview with Moira Hutchinson. July 28th 2014
4) http://www.share.ca/about/responsible-investment/taskforce-on-the-churches-and-corporate-responsibility/
5) http://www.investopedia.com/terms/a/alternative_investment.asp

Blog: What’s Your Impact Investing Story?

At 20 years old, I became an impact investor, even though I didn’t know what “impact investing” was.¹

I turned up at an investment firm with a crumped piece of paper in my hand; it was a single paragraph that I’d ripped it out of The Economist about an investment fund that was supporting local enterprise in developing countries in South East Asia.

Seven years earlier, my family and I had been living in Indonesia, it was 1997 and the Asian economy was crumbling around us. As the political situation became increasingly violent, we decided to leave.

Now, I wanted to use my money (the little that I had, as a debt-laden university student) to help the societies of the people I had met growing up. I didn’t want to go the charity route—the ol’ “give a man a fish or teach a man to fish” had proven itself to me again and again. When I read about the investment fund in The Economist, I saw an opportunity to save money, make money (to me, it seemed the Asian economy could only go up) and to support a cause I believed in—helping others to help themselves.

When I explained my plan to my new financial advisor, he flat out refused to assist me. Eventually he admitted that his investment firm carried a similar product to the one described in The Economist, but he strongly advised me against it. We went back and forth for 20 minutes, arguing, until he finally relented, begrudgingly. A year later, I returned to discover that the fund had increased by 30%. My financial advisor apologized.

Although I didn’t know it at the time, I was participating in Impact Investment, “an investment…with the explicit intention to create a positive impact and generate a financial return,”² or, as my 20-year old self would have described it: “a cool way to make money and a difference at the same time.”

Sir Ronald Cohen, Chairman of the Social Impact Investment Taskforce, explains much more eloquently, that “impact investment is a response to the urgent need to achieve innovation and scale in the way we tackle today’s complex societal challenges. It seeks to channel capital to drive measurable social and financial returns. It aims to harness investment and entrepreneurial skills to drive social innovation in the same manner investment and enterprise drives business and technical innovation.” ³

Now, I’ve added ZooShare to my impact investment portfolio. I’m proud to be a member of such a forward-thinking group of investors. Together, we are supporting a local project that will make a lasting positive impact on our environment, long after our principals are returned. As the impact investing industry continues to grow, I look forward to discovering and researching other impact investment opportunities to diversity my portfolio and amplify my personal impact, so I can leave this world better than I found it.

What’s your impact investing story? Email me to be interviewed, and possibly have your story shared on the ZooShare blog.

Sources:

¹ Indeed, the term “Impact Investing” wasn’t coined until a few years later, in 2007. Financing Social Good: A Primer on Impact Investing in Canada. Toronto: Purpose Capital, RBC, Mars Centre for Impacting Investing. Pg. 5. Retrieved from: http://www.rbc.com/community-sustainability/_assets-custom/pdf/Financing-Social-Good.pdf
^2,3 Harji, Karim. Reynolds, Joanna. Best, Hilary. Jeyaloganathan, Mathu. (2014) State of the Nation Impact Investing in Canada. Toronto: Purpose Capital, The MaRS Centre for Impact Investing. Pg. 90. Retrieved from: http://impactinvesting.marsdd.com/wp-content/uploads/2014/03/Impact-Investing-in-Canada-State-of-the-Nation.pdf