By Steve Butz
As I sit down to write, I’m finding it challenging to determine which of the many important concepts presented at the conference to focus on for this post, and how to transfer the information in what seems like real-time. With that caveat, I do have a few thoughts on the session I just attended titled “The Myths and Realities of Socially Responsible Investing (SRI).”
I am currently engaged in a number of efforts to change the climate of investing in the social sector and expected from the session’s title, to be thrust into a riveting discussion of understanding true ROI when making grants and determining the relative effectiveness of organizations involved in solving problems. It turns out the session was about what foundations should do with the “other 95%” of the assets – namely, the money they invest to make money! Wrong session, but I was determined to stick it out.
I was very intrigued by the idea that a good case can be made for “Socially Responsible” investing even when size of return is the most important criteria for investing. It was well supported by data presented during the “debate-oriented” portion of the session. I would have preferred if more of the discussion focused on an idea presented much later into the session– why the 95% should be spent without question.
This session focused a bit too exclusively on the idea that you can make really decent returns investing wisely in your values but did not challenge the foundations present, to evaluate if those investments specifically relate to their grant-making efforts – a critical aspect of the decision in my opinion.
Also interesting was a show of hands about those foundations whose objective in asset management was to exist into “perpetuity” vs. those in a “spend down” situation. I wonder if any session will ever focus on which approach might actually foster more social change (which I perceive to be the “end game” to philanthropy anyway), and I have to admit doing some soul-searching on behalf of the small foundation I have personally just started on this topic. Honestly, I had never thought about this before.