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Bruce DeBoskey of the DeBoskey Group.
Bruce DeBoskey of the DeBoskey Group.

Impact Investing: Putting Your Money Where Your Values Are

Bruce DeBoskey of the DeBoskey Group.

More than ever, investors are pondering, “Am I destroying with my left hand what my right hand is trying to save?”

Trillions of dollars are invested by millions of Americans in stocks and mutual funds, banks, and retirement funds like IRAs and 401(k)s, seeking to generate significant financial returns. Most of these investors are philanthropic, supporting causes that reflect their values. Many are searching for ways to blend their investment goals with their philanthropic priorities.

The Global Impact Investing Network defines “impact investments” as “investments made into companies, organizations and funds with the intention to generate measurable social and environmental impact alongside a financial return.”

Increasingly, investors are wondering what’s behind the asset classes of their investments, inquiring “Where does my money spend the night?” and posing challenging questions along these lines:

  • Am I donating to environmental causes but investing in companies that may contribute to environmental degradation and climate change?
  • Do I buy organic foods, recycle and care about sustainable agriculture and family farms but invest in companies that derive profits from agribusiness, pesticides, tobacco and fast food?
  • Am I contributing to nonprofits providing opportunities for women and girls and investing in companies practicing gender-pay inequity or other forms of discrimination?
  • Am I supporting organizations concerned about human rights and the elimination of child labor and investing in companies that source their products from factories and farms that violate these values?

There are many resources to help investors learn about impact investing.

Calvert Foundation is a leading, well-respected organization helping investors at all levels achieve the double bottom line of profit and positive social or environmental impact.

Jed Emerson, co-author of “Impact Investing: Transforming How We Make Money While Making a Difference” (2011), and chief impact strategist for Impact Assets, a nonprofit financial services firm specializing in impact investing, explains that there are “now many investors at all levels who are funding strategies that provide a desirable level of financial return while generating positive social and environmental impacts.”

RSF Social Finance is a nonprofit financial services organization providing capital to social enterprises. Mark Finser, RSF’s board chairman and co-founder, wants people to be aware that “when money is invested in banks, stocks or mutual funds, it creates some kind of effect in the world. Many options exist for transparent, direct and personal investments that help empower and create the kind of communities and world people want to live in.”

Marian Moore, co-founder of Play Big, works with wealthy individuals asking, “What, beyond their net worth, would they like to see grow?” and helps them align their money with their values.

Traditional investment advisers like JP Morgan Chase & Co., banks like New Resource Bank, local credit unions, community banks, and others offer opportunities for impact investors.

Community Development Financial Institutions like the Colorado Enterprise Fund, Funding Partners for Housing Solutions, and Mile High Community Loan Fund, and many others, make loans to support affordable housing, commercial real estate development in underserved neighborhoods, small businesses, and nonprofits serving low-income people. CDFIs accept capital from banks, government entities, accredited investors, family and community foundations, and other institutional investors desiring a community benefit alongside a financial return.

Investments are the vehicle by which many people generate the resources to fuel their philanthropy. Impact investing not only helps screen for negative social consequences, it also brings the values that inspire your philanthropy to at least part of your investment portfolio and helps you positively impact the world from the engine of your assets, rather than merely the fumes.

Bruce DeBoskey is a Colorado-based philanthropic adviser, helping families, businesses and foundations with their philanthropic initiatives. Learn more at www.deboskeygroup.com. This article originally appeared in the Denver Post on October 21, 2012.  It is reposted here by the author.

About Bruce DeBoskey

Bruce DeBoskey
Bruce DeBoskey, J.D., is a Colorado-based philanthropic adviser working with The DeBoskey Group to help businesses, foundations and families design and implement thoughtful philanthropic strategies and actionable plans. He is the President of the Colorado Philanthropic Advisors Network, a Teaching Fellow with Boston College's Center for Corporate Citizenship and a frequent keynote speaker at conferences on philanthropy. More information at www.deboskeygroup.com (http://www.deboskeygroup.com)

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One comment

  1. Steve Ellis

    Nice work Bruce! Our firm, Colorado Capital Management, is very excited about the world of impact investing, and is getting deeply immersed in this work. For anyone seeking a financial advisor to help guide their impact investments, we would be happy to be of assistance. And if you are a professional entering or engaged in this field, and are looking for collaborators, we would be delighted to discuss how we might work together.

    Steve Ellis
    Colorado Capital Management