Paul: Bob, you are Sonya’s father and a former chairman of PIA, right?

Bob: Yes. I was on the board for six years and chairman the year that the board chose Sonya’s predecessor. At that time, Sonya was chief operating officer. I was no longer on the board when she was selected president and CEO, but I was a very proud dad when that happened! She’s done a tremendous job in a really tough environment for independent firms.

Paul: Sonya, give us your perspective on the new DOL fiduciary rules that firms are being required to follow. There’s a lot of discussion in the industry about their potential impact, and from an ESG or impact investing perspective, a lot of people believe we need more comprehensive fiduciary oversight.

Sonya: The challenge is to scale a response to the new regulations because the old ones don’t go away—so there’s just more. We’ve contracted with a great compliance firm that has been very helpful in the past year, but it’s an ongoing process.

Paul: From the sustainable and impact investing perspective, do you see these new fiduciary rules as something that the industry will adjust to and learn how to work with in a way that is helpful for investors? Or will they just create more regulatory infrastructure?

Sonya: That’s hard to say. I think the new regulations are well intended, and better protecting the end client is always a good idea, but increased regulation is very challenging for smaller firms. That is one of the reasons we see more and more consolidation in the industry.

Paul: Bob, you now work solely as an advisor, right? 

Bob: I’m both an advisor and a PIA shareholder. The firm is owned by our employees and advisors.

Paul: Are all of the employees and advisors shareholders?

Sonya: No. But many of them are. It’s not mandatory.

Paul: Bob, one of the major differences in the sustainable and impact investing industry today is that it’s not only focused on negative screening and exclusionary strategies. Thematic strategies are used by investors to generate portfolio alpha as well.

Bob: That’s right. I believe one of the themes that offers good growth potential is in alternative energy. Another proactive approach is community investment notes, which provide loans to lower income communities that are underserved by the traditional banking industry.

Paul: Sonya, does PIA as a firm do direct shareholder engagement with companies?

Sonya: No, we don’t. Each of our advisors owns their own independent practice, so PIA is not doing any engagement on behalf of clients. But our advisors may offer clients mutual funds or separately managed accounts that do participate in shareholder engagement at some level.