On a Friday morning in July, money manager Geeta Aiyer had cause to celebrate a victory against a very prominent symbol of racial discrimination.
During a virtual meeting, Aiyer applauded a deputy for helping win a 12-year battle involving FedEx Corp. Her firm—along with other investors and advocacy groups—had been pressing the shipping giant to end its relationship with the National Football League’s Washington Redskins because of the team’s racially inflammatory name.
FedEx had finally given in, saying it would remove its signage from the team’s stadium unless it dropped “Redskins.” The team soon complied.
“There comes a tipping point when, after a company has been fighting you, they suddenly let go because it becomes obvious to them that it’s not worth continuing the fight,’’ said Aiyer, founder of $2.7 billion Boston Common Asset Management. “That’s how we win.’’
Aiyer should know. The 62-year-old has been taking the world of business and finance to task for its role in systemic racism for longer than most. Now, as the double-whammy of the coronavirus pandemic and protests against racial injustice catapult the ‘S’ in ESG to the forefront, Aiyer and her team have hatched a new game plan.
Boston Common is planning to confront banks and real estate investors as an eviction crisis looms across the U.S., one that’s likely to disproportionately impact Black Americans and other minorities. Aiyer said she will renew pressure on nine global companies (which she declined to name) to better combat racial inequity within their ranks, products and services—and to boost transparency when it comes to lobbying.
So far this year, performance by the Boston-based firm’s ESG Impact International Fund is flat, while its benchmark, the MSCI EAFE Index, has tumbled 7.1%. Over the last three years, however, the ESG fund returned an annual 10.6% while its benchmark rose 10.2%.
Minorities were already in a precarious situation before the pandemic struck. Targeted by predatory mortgage lenders during the 2000s, they suffered disproportionately during the 2008 housing crisis. Over the following years, they increasingly became renters as affordability worsened and gentrification accelerated. Aiyer said that rising rents, coupled with flat or falling incomes, conspired to heighten the risk of minorities losing their homes.
Already enduring the brunt of the pandemic’s health and financial effects, these same populations are vulnerable to the flood of evictions that have been predicted for 2020. Minorities don’t own homes at the same rate as White Americans—and for renters, job losses can quickly lead to late or missed rent payments, Aiyer said.
As the crisis arrives, Boston Common plans to approach lenders and owners of real estate investment trusts, or REITs—entities that own a large number of buildings in the U.S.—about continued forbearance, as well as their preparedness to renegotiate, lengthen or forgive loans, she said.