Paul: What have been the most surprising and challenging issues you’ve encountered in your learning curve at the firm?
Laura: Two things: First, working for a company the size of First Affirmative gives me the opportunity to take something and run with it. Second is shareholder advocacy, which is now what I am most passionate about. I knew about proxy voting, but I had never been part of an organization that took all of these proxies and collectively voted towards a position. I find it fascinating that you can have an impact beyond buying shares in companies and getting a financial return. You can actually make a difference within a company’s business.
Steve: I think that through the ongoing dialogue that many of us in the SRI space have with the publically owned companies in our portfolios, we have the opportunity to positively impact the behavior of these firms. These are impact strategies we can offer to investors in the public markets, and it’s what First Affirmative does pretty well.
Paul: Laura, a lot of the millennials I know are skeptical of the positive outcomes being achieved in engaging with public companies. Can you share a story about advocacy and or proxy filing?
Laura: We’re back to education! Helping millennials understand the process by which we can vote together toward better practices will create more enthusiasm for participating. An example of a success we had in the past is with Whole Foods. We co-filed a food waste resolution that received 28 percent shareholder support, which is quite high given this was the first food waste-based resolution filed. Now we are dialoging directly with Whole Foods and anticipate significant improvement from them over time.
Steve: It’s important to realize that the vast majority of people who own stocks do not vote their proxies. When you combine your proxy with lots of other investors and there is a professional organization like First Affirmative, Calvert or Pax World leading the effort, we can have a greater impact on corporate behavior.
Paul: Well said. This is a critical concept for investors to understand about how sustainable and responsible investing works. Steve, what do the next few years in our industry look like from your perspective?
Steve: We are well positioned for growth, which is coming from increased awareness and demand. Let’s be honest. Sustainable and responsible investing is not an idea that was cooked up by Wall Street and sold to us like many financial products are. The evolution and growth of this industry that has led to today is almost totally driven by consumer demand. The large companies that have jumped into this pool in the last couple of years are here because of that.
Paul: Laura, any last words for the millennials reading this article?
Laura: Research says that 60 percent of millennials have changed jobs one-four times in the last five years. I’ve now had three jobs and the average millennial will have 15-20 in their lifetime. So it’s cool to be at a place like First Affirmative where I finally have my first dream job. I can see myself working here for a long time!
Paul Ellis founded Paul Ellis Consulting to work with financial advisors who want to integrate sustainable and impact investment strategies for their clients. Steve Schueth is president of First Affirmative Financial Network and Laura Isanuk is business development and marketing manager for First Affirmative Financial Network.