Friday, June 11, 2010

Canadian Responsible Investment Conference Preview: Elements of success for the SRI advisor

By Valentina Bellicova, writer and blogger based in Vancouver

Steve Schueth, president of First Affirmative Financial Network and former director of the Social Investment Forum, fell into the world of finance and picked up a baton which at the time was a mere idea, an idea that you can invest both for profit and for good and that it can be one and the same. Born and raised in Iowa, Steve cut his real life chops in the world of investing: real estate and securities underscored by finance. After 30 years in the business it’s what he knows, it’s what he’s good at and more to the point, it’s his life.

Steve could have done well on the straight and narrow conventional way of quantitative analysis investing, instead, he decided to focus on the less visible: policies, practices and even culture. A recommendation to invest based not so much on hard core performance supported by metrics but rather on social responsibility supported by observation and moral judgement. It’s a radical departure from anything taught in business school – yet that is exactly what Steve did, one could definitely say that the road less travelled has done rather well by him.

At First Affirmative Financial Network, Steve has expanded the company’s emphasis to include sustainable as well as social and responsible investment. Analysts look to uncover profitable, sustainable and socially responsible companies with a view to the future instead of the past. No crystal ball gazing here, instead it’s all about gauging a firm’s corporate governance, its transparency and whether it is well managed and more profitable than others in their industry fields.

Who are the investors?

According to 2007 statistics put out by the Social Investment Forum, 2.7 trillion dollars are professionally managed and classified as SRI. Investments come from large institutional investors such as the New York State Pension Plan, from family foundations and lastly from individuals who connect the dots between their values and their dollars. Ultimately, these are all people who want their investments to reflect who they are. They want their money to work for good and to put profits in their pockets at the same time. Each year the numbers grow. But it wasn’t always so.

Steve was the Director of Development at the Wharton School of Business at the University of Pennsylvania when he met Wayne Silby and John Guffey, founders of Calvert Investments, a U.S. pioneer in social responsibility investing. It wasn’t so much an “aha” moment as one that Steve sort of grew into. He started paying attention to what Wayne and John were doing at Calvert. Soon the notion of questioning what your money is doing and where it is employed began to take hold. The idea that you could use money in a way that was more reflective of your own values just began to make sense.

In 1989, Steve joined Calvert Investments. Green was making a mark on consumers and doing what’s right was the natural progression for investors. It was the right time for expansion and exciting times for Steve. As he worked closely with like minded colleagues Steve saw Calvert take on leadership status in the field of sustainable investment strategies. In 1993 he was promoted to President of Calvert Distributors, the dealer-broker arm of the company and became responsible for it’s sales efforts until 1997. During his tenure at Calvert Steve and his team created the first global screened social mutual fund in the U.S. and was directly involved in four other socially responsible mutual funds.

The unasked question: What does the future hold for SRI?

The unspoken answer: The world has shifted. SRI has come into its own. In terms of time, it was but a mere moment ago when the idea was first spoken – a moment that slowly rose on the horizon some 40 years past. And as moments go it was a scraggly little thing, scrawny and void of muscle, but it had some muster and a vision and wobbly though it was, it has stood the test of time, gaining strength and momentum. Today, that idea draws more than a little bit of respect and attention, all fuelled by a moment in time which continues still. Call that moment the sustainable and responsible approach to investing. It has only just begun to shine on the horizon.

Steve Schueth hosts “Elements of success for the SRI advisor: tips from the experts” on Tuesday, June 15 at 9:15 am at the 2010 Canadian Responsible Investment Conference.

Valentina Bellicova lives, writes and goes for long walks along the shores of Vancouver, BC. Born in Yokohama, Japan she came to Canada in her early twenties. She ascribes her love of nature and beauty to her mother. Valentina is a professional blogger, has several of her own and can be reached at her flagship blog: Blog Income Life

This is the fifth in a series of articles on the 2010 Canadian Responsible Investment Conference. Subscribe to SRI Monitor for more pre-conference articles this week and full blogging coverage during the three-day conference.

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