AD: Every necessary change comes from some person or some company taking up an issue and creating a steady drumbeat. I personally, and Domini Impact Investments, as an extension of myself, has been that steady drumbeat on the intersection of finance, ecological sustainability, and universal human dignity. I was influenced by the book The Provocateur, by Larry Weber, which states that leaders are successful not just because they’ve built a company but because they’ve created a community. Domini will continue to carry on as the provocateur, building, inspiring, and innovating the impact investing community long after I am gone.
SK: What is your hope for the future of ESG?
AD: The next frontier is standardized reporting to shareholders integrated into quarterly and annually regulated reporting, comparable to the financial reporting that exists today. Companies need to report on the impact their operations are having on people and the planet in a manner that is quantifiable and relevant. With this information, investors will make better, more informed choices.
SK: What does a Biden or a Trump win in the U.S. presidential election mean for the world of ESG?
AD: It won’t be a slam-dunk either way. Certainly, Trump is a great deal friendlier to oil and armaments than the ESG investor would want. Biden would certainly be helpful on alternative-energy legislation, or he would try to be helpful. But you still have Congress to get through. He would get us back into the Paris Agreement. Still, the Obama administration had eight years, and he gave the SEC power to do all the kinds of things that would complement ESG. But they never did.
At some point this crazy market has to wake up. I personally don’t think that it’s going to be the election that causes that. A purely devastating series of climate events is more likely to. One fire in upstate California last year, a four-day event, bankrupted a utility. If you have 10 of those events in a year, a trillion dollars here and a trillion dollars there, pretty soon you’re talking about something that really devastates the economy. It could be two to three years before we see that. I think this is a clear and present danger and more likely than the election to affect the stock market.
This article was provided by Bloomberg News.