SRI: Socially
Responsible Investing
This is a collection of the presentations on
SRI funds and forums from the 9:30 class in
Fall 2008 for Business 356 (Business Ethics)
Eric Grieser
Brian Kooienga
Alex Kron
BJ Sullivan
Meritas SRI
•Canada based
Investment Firm
•Invests 2% in
community
•About 30 years old
•Created by church
research group
•Considers ethics and
environment in addition
to financial outlook
"...good product selection plus
highly qualified and innovative
management..."
POSITIVE SCREENS
 International Labor
Standards
 Environmental
Impact
 Employee Relations
 Gender and
Cultural Equity
Policies
NEGATIVE SCREENS
 Military/Weapon
Development
 Alcohol and
Tobacco
 Pornography and
Gambling
 Nuclear Power
Fund Overview
-Balanced growth approach with capital
appreciation
-Higher potential returns with fixed income
securities
-Long term growth through foreign investing
-Canadian equity securities which comprise
the Jantzi Social Index
-Income from a short term, low risk investment
through Canadian government
-Income-producing Canadian Equity securities
-Long term growth through undervalued
securities of medium to large capitalization
companies
Corporate Vision
To be the trusted leader and champion of socially
responsible investing in Canada
Environmental, Social, Governance
Policies
Common Industries
Exclusions
 Banking
 Military
 Financial
 Tobacco
 Oil and Gas
 Nuclear
 Transportation
 Energy
 Climate Change
 Biodiversity
 Human Rights
 Fight Sweatshop Conditions
 Good Governance
 European Social Investment Forum was created in 2001 to
cover socially responsible issues in Europe.
 It is a not-for-profit entity funded by affiliate membership and
public grants
 Five original Social Investing Forum founding nations:
 France
 Germany
 Italy
 Netherlands
 UK
 Board of Directors – appointed as board members
from Social Investment Forums nations
 Decide the main activities and strategic initiatives of
Eurosif
 Advisory Council – made up of member affiliates
who guide strategy
 Mission: “Address Sustainability through Financial
Markets”
 Lobbying
 European Commission and European Parliament
 Research
 Legislation, policies, and practices for ethical
governance
 Initiatives
 Goals to advance socially responsible investing
 Event/Communication
 With member affiliates and board
 Pay an annual fee
 Join with the subscription of the morally responsible
principles of Eurosif
 Member Affiliates include:
 KPMG, Greenpeace, Fortis Investments, Pioneer
Investments, etc.
 Eurosif does not directly invest, but promotes
socially responsible investment
 Factors include:
 Corporate governance/board members
 Intellectual property
 Procurement policy and practice
 Environmental and social impact of products
 Compliance with regulations
 Worker’s Rights
 Community Involvement
 Canadian company
 6 different funds
 Must be Canadian in order to purchase funds
 Are the company’s practices environmentally




sustainable?
Do they comply with relevant laws and industry
regulations?
Is their workforce treated fairly?
Do they have safe products?
Are their corporate governance procedures thorough
and transparent?
 Shareholders
 Community
 Customers
 Employees







Employee relations
Diversity
Environmental commitments
Community relations
Corporate governance and citizenship
Human rights
Sustainable products
 Strong businesses
 Solid growth potential
 Reasonable stock price
SRI Funds
Analysis by Bob Forrest, Alex Higbie,
Laura Hund and Dan Sickle
A Fund Brief
 Green Century chooses not to invest in companies
with bad environmental and social records in:
 Waste disposal
 Toxic emissions
 Environmental fines and penalties
 Product/service performance
 Waste and emissions reductions
 Corporate citizenship
 Recycling
 Employee relations
As of 30 June 2008
Sector Allocation
Automobiles & Components
0.25%
Materials
2.39%
Banks
5.17%
Media
2.69%
Capital Goods
4.05%
Pharmaceuticals & Biotech
8.50%
Commercial Services & Supplies
0.56%
Real Estate
0.64%
Consumer Durables & Apparel
1.39%
Renewables & Efficiency
0.64%
Consumer Services
1.52%
Retailing
3.78%
Diversified Financials
6.79%
Semiconductors
3.99%
Energy
6.35%
Software & Services
6.69%
Food & Beverage
5.23%
Technology Hardware
11.18%
Food & Staples Retail
3.09%
Telecom Services
5.94%
Healthcare Equipment & Service
4.98%
Transportation
2.48%
Healthy Living
0.09%
Utilities
Household & Personal Products
5.03%
Cash & Equivalents
Insurance
2.89%
1.23%
2.47%
 Green Century opts not to invest in companies who
receive great amounts of revenue from the following:
 Tobacco
 Alcohol
 Gambling
 Nuclear
 Firearms
 This includes any company who receives 2% or more of
their revenues from military weapons
TIAA-CREF
A national financial services organization
and provider of retirement services
Introduced the TIAA-CREF Social Choice
Equity Fund on July 1, 1999
Social Choice Equity Fund
 Founded to produce a “favorable long- term total
return…while also giving special consideration to
certain social criteria”
 Includes domestic and international investments
 Net assets of $602 million
 Largest socially screened portfolio nationally and
internationally
Screening Process
 Invests 80 percent of net assets in equity securities
 Investments screened by KLD Research and Analytics
Broad Market Social Index
 Companies struggling in a particular area are
compared to industry peers
KLD Index Screening
 Fund Supports:
 Safe/Useful products
 Good employee
relations
 Human rights
 Diversity in the
workplace
 Corporate philanthropic
activities
 Environmental
performance
 Fund Declines:
 Manufacturing/Selling
of alcohol or tobacco
 Revenues in gambling
 Manufacturing/Selling
of firearms or
ammunition
 Involvement in nuclear
power plants
Northern Trust Global
Sustainability Index Fund
Northern Trust Corporation
 Investment Management
 Based in Chicago
 Assets in custody: over $4.1 trillion
Sustainability Index Fund
Mission
 The Fund seeks long-term performance by
investing in companies selected for their
projected investment and social returns.
Factors for Consideration
 The Funds include stocks from 24 different
markets for firms that promote:
 Environmental
 Social
 Governmental responsibility
 “Sin stocks”
Norwegian Pension Fund
Fund
Background
 Managed by Norway’s Ministry of Finance
 International assets managed by Norges Bank
Investment Management
 It is a continuation of the former Petroleum Fund,
established in 1990
 Became the Norwegian Pension in Fund in 2006
Investment
 Strategy: 60% in equities and 40% in fixed income
instruments
 Actuality: 51.8% in equities and 48.2% in fixed income
instruments
 At the end of Q2 in 2008, fund was approximately $158
billion
Negative Screening for
Investment
 Serious or systematic human rights violations
 Serious violations of individuals’ rights in situations of
war or conflict
 Severe environmental damages
 Gross corruption
 Other particularly serious violations of fundamental
ethical norms
Ethics Powerpoint
“Section 1Katt,Moore,&Thomas”
CalPERS
(California Public Employees’ Retirement System)
By
Ben Katt
CalPERS (The Basics)
 Fund for California state employees to provide healthcare
and retirement benefits
 Largest Public Fund in the United States
 Started in 1932 by state legislation
 Nearly $236 billion in assets
 1.6 million members
 Benefits based on:
 Length of Employment
 Age
 Highest Attained Salary
 Employees make monthly contributions, receive pension for
life
 Decisions influenced by socially responsible investments
starting in the year 2000
CalPERS Philosophy
 Mission Statement
 “Our mission is to advance the financial and health security
for all who participate in the System. We will fulfill this
mission by creating and maintaining an environment that
produces responsiveness to all those we serve.”
 Social Responsibility Investments starting in 2000
 Investments in companies that provide affordable housing,
create jobs, clean up inner city slums
 Invest within the state, i.e. CA Real Estate
 Dropped investments in countries that restricted free press,
labor unions, and democracy in general ( criticized for
dropping good companies in bad countries)
 Dropped companies such as the tobacco industry
CalPERS Focus List
 Annual list generated to identify the worst performing
companies in the CalPERS portfolio
 Process includes:
1. A quantitative screen
2. A qualitative review
3. An engagement process
 Once identified CalPERS uses their size to reform the
company’s governance practices with an emphasis on
accountability, transparency, independence, and discipline
to attempt to increase shareholder value
 CalPERS generally uses shareholder proposals as a tool to
reform poor performance
 Typically successful in creating value for underperforming
companies by encouraging change and improvement.
CalPERS Focus List Continued
 The list serves as an embarrassment for the companies on
the list
 Poor Performance
 Bad Corporate Governance
 Encourages change and improvement
 The 2008 List
 Cheesecake Factory Inc.
 La-Z-Boy Inc.
 Hilb Rogal & Hobbs Co.
 Invacare Corp
 Standard Pacific Corp.
Ariel Investments
By
Joe Moore
Ariel Investments (The Basics)
 Founded by John W. Rogers Jr. and his family in
Chicago in 1983 as Ariel Mutual Funds.
 Changed name in April to Ariel Investments
 Nearly 100 employees.
 20% of employees let go on August 14th 2008
 Mainly invest in small and mid-cap stocks striving for
long term gain “as a tortoise” not quick returns.
 Over $8 billion in total assets (June 2008)
 Ariel Fund lost 23% in the previous year ending August
19th 2008 and Ariel Appreciation Fund has lost 14%
(total loss nearly $1 billion.)
Ariel Investments
Mission:
In earnest pursuit of excellent performance and outstanding client service, patience is our overarching virtue. By taking a long-term view, we are able to build our firm around these core values:
Focus
By purchasing stocks that are undervalued, and patiently waiting for the market to recognize their true
worth, we believe we can achieve long-term capital appreciation. Given our commitment to patience, it
makes perfect sense that we have adopted the tortoise, the victor in Aesop’s timeless fable, as our symbol,
and the fable’s moral – slow & steady wins the race – as our creed.
Independent Thinking
We are a team of independent thinkers, industry watchers and disciplined decision makers. We operate
under the premise that financial success is achieved not by chasing the crowd, but by following our own
convictions.
Teamwork
At Ariel, teamwork is how we get the job done. Everyone has the opportunity to put his or her best ideas
forward, and leverage his or her expertise to create the best possible solutions for shareholders. Our
employees share in the rewards and responsibilities of ownership in the firm. Everyone at Ariel is an
owner – from our receptionists to our president. Moreover, by investing our own savings, profit sharing
and retirement dollars in both our firm and the Funds, our personal financial success is squarely aligned
with our clients and shareholders.
Ariel Investments
 Focused specifically on:
 Small & Mid-cap funds
 American Focused
 Quality



Leaders in industries
 Need to have honesty and integrity throughout the management
 Build relationship with competitors and peers in the marketplace who have
bought the stock so they know independent prospective about the
management
 BIA associates who help them identify what is important
Sustainable competitive advantage
Above market returns over long periods of time
 Expertise
 Only invest in industries that they think they know more about than other people
 Value
 Buy companies at 40% discount to intrinsic value…
 Buy company for $.60 when it is valued at $1.
 Buy when they are not favored
 Highly unpopular stocks are bought
Ariel Investments
 My evaluation:
 Company is solid in the evaluation of the “social” benefit of
the company.
 They do many background checks and other ways of
identifying the companies that they will and won’t deal with.
 I would not buy into this investment firm based on the fact
that they are to specific on what qualifies a company to be
able to be invested in, they will not buy a company if they feel
that it is valued at the right price and not underpriced, and
their history (now).
 I do not feel it would be economical to suggest others to
purchase into this investment firm, especially given the
amount of money they have currently lost (nearly 12.5% of
their total assets. Also have recently had other major
corporations pull their money out of Ariel.
Walters
Section 1
Tim Walters, Chris Schuler, Sabrina Linden and Steven Timperio
Mennonite Mutual Aid
 Roots in the Anabaptist Church
 “Church communities putting faith into action by
sharing resources with each other”
 Attempt to maximize investment returns subject to
the principles of socially responsible investing.
 Offices in Goshan, Indiana
Stewardship Investing
 Uses set of core values to determine which companies
they will invest with
 Search for “Ideal Corporate Behavior”
 Respect Basic Human Rights
 Cultural Diversity
 Peace and freedom from violence
 Community Involvement
 Long term environmental Health
Stewardship Investing
 Won’t do business with companies they believe don’t
meet these core values
 Alcohol, tobacco, gambling
 Careful consideration to animal testing
 Abortion specific products
 Military and weapons
Community First
 Have a background of communities supporting each
other
 Supportive and involved with community
 Dedicate 1% of portfolio to community investments
 Also have proactive approaches to human rights, equity
and employment, labor relations, product and service
related investments
Portfolio 21
 Mission Statement
 We designed Portfolio 21 to address the ecological
risks and opportunities of the investment process in
the 21st century
Evaluation Criteria
 Business Models: Lean Manufacturing/Regional
Distribution Centers
 Impacts of Products/Services: Product Life Cycle
Analysis, Recycling Programs
 Investments: Research and Development of
ecologically superior products
Evaluation Criteria Cont.
 Leadership: Views ecological sustainability as
opportunity. Support environmental legislation and
regulation
 Environmental Management: Internal Controls on
environmental impacts and liabilities, 3rd party
evaluation of EMS
 Environmental Risks and Liabilities: Strategic
planning to reduce greenhouse gas emissions
Selective Investments
 Alcohol – No screening
 Smoking – No Investment
 Gambling – Restricted investment
 Weapons/Defense – Restricted Investment
 Animal Testing – Restricted Investment
 Products/Services – positive investment
 Environment – positive investment
Future Sustainability
 The goal is to support companies who provide the
essential functions of meeting human needs without
diminishing nature’s ability to support our economy
in the future.
American Trust Allegiance
 American Trust is an independent trust company
chartered in 1991 in New Hampshire.
 Provides investment management and trust services
for individuals and institutions.
 Manages two socially responsible mutual funds.
American Trust Allegiance
American Trust Energy Alternatives Fund (ATEAX)
 Focuses on companies leading the transition from
carbon based energy to renewable energy.
 Investments in this fund include foreign securities and
many smaller companies, both of which are high risk.
American Trust Allegiance
 American Trust Allegiance Fund (ATAFX)
 Established in March 1997.
 Broadly diversified growth fund with a large cap.
 Screens out alcohol, tobacco, pharmaceuticals and gaming stocks.
 Invests in small and medium capitalization companies and may
avoid investments for social reasons when it is otherwise
disadvantageous to do so.
American Trust Allegiance
 In addition to its two socially responsible mutual
funds, ATA also works individually with clients on
personal socially responsible portfolios.
 Also provides services such as Trusteeships and
securities analysis.
Drew Thomas
SRI Project
Guiding Principles
 Disciplined Value Investing
 Socially Responsible Investing
 Low Shareholder Expenses
 Portfolio Manager Ownership
Investment Approach
 Value
 Sustainability
 Focus
 Patience
 Alignment
Socially Responsible Mutual Fund Charts: Screening & Advocacy
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Investing in Socially Responsible Funds
Cara Persichetti
The Way You Invest Matters: Be Part
of the Solution
 "triple bottom line“: Not only "investors," they are also concerned
citizens.
 the state of the natural environment, how corporations treat their
workers, and the communities in which they operate
 Domini Social Equity Fund, Domini European Social Equity Fund,
Domini European Pacasia Social Equity Fund, Domini Pacasia
Social Equity Fund, and Domini Social Bond Fund
 Domini 400 Social Index*,SM an index of 400 primarily large-cap
U.S. corporations
Societal Objectives
Ecosystems
Renewable and Alternative Energy Sources
Eco-Efficiency and Resource Conservation
Recycling, Safer Technologies, and Lifecycle Design
Pollution Control and Abatement
Long-Term Environmental Sustainability
Employees
Continuous Improvement in Health and Safety
Fair and Just Compensation and Benefit Programs
Commitments to Diversity in the Workplace
Empowerment and Investments in Training
Solidarity with Unionized Workforce
Investors
Accounting, Credibility, and Business Ethics
Openness in Communications
Commitment to Diversity of Representation
Relationships with Controlling Owners
Suppliers
Labor Practices and Other Human Rights
Quality, Environment, and Other Issues
Diversity Within the Supply Chain
Empowerment and Viability
Societal Evaluations
 exclude from our funds companies with mixed records where negatives
substantially outweigh the positives.
 evaluate these companies case-by-case, looking for signs of
improvement and positive trends.
 sufficient information is usually available to make judgments and
themes that represent goals we believe are reasonably achievable.
 Levels of impact 1(lowest)-5(highest)
KLD Research & Analytics, Inc
Andrew Strick
About KLD
 Year Founded: 1988
 Location: Boston, Massachusetts
 Founder: Peter Kinder (co-founder)
Mission
 To provide global research and index products to facilitate the
integration of environmental, social and governance factors into the
investment process;
 To define, by means of our products and services, accountability
standards that enable investors, managers and fiduciaries to influence
corporate behavior through their investment decisions and share
ownership; and
 To effect, through this influence, greater corporate accountability and,
ultimately, a more just and sustainable world.
Clients
 Not listed on website
 Does give a performance comparison
Screens
 5 sources of information
 Company
 Research partners
 Media
 Public documents
 Government and NGO
 7 qualitative issue areas
 Environment
 Community
 Corporate governance
 Diversity
 Employee relations
 Human rights
 Product quality and safety
Recommendations
Would I buy or recommend KLD Research & Analytics, Inc.?
NO
 Reasons
 Lack of information
 No definitions
 “Window dressing”
Sources
Mission & About KLD
 http://www.kld.com/about/index.html
KLD Founding
 http://www.kld.com/about/BoardOfDirectors.html
Screens
 http://www.kld.com/research/methodology.html
Performance Comparison
 http://www.kld.com/newsletter/archive/press/pdf/200808_Index_Perf
ormance.pdf
Calvert Socially Responsible
Investing
Courtney Hanson
Calvert Socially Responsible
Investing
 Background: Calvert Group
 founded in 1976 is headquartered in suburban Washington, D.C
 400,000 investors in Calvert with over $14 Billion in assets.
 Double Diligence research process approach emphasizes rigorous
fundamental research and a thorough assessment of corporate
integrity.
 Core belief - corporations and mutual funds should be governed and
managed for the benefit of their shareholders.
Equity Portfolio
 3 share classes
 Class A inception 8/24/98 (4.75%)




Minimum
Initial investment $1,000
Class B 3/31/98
Subsequent
investment $250
Class C 3/1/94
The portfolio invests primarily in the common stocks of U.S.
Large-cap companies.
Atlanta Capital Management Company analyses and identifies
high-quality, growth stocks that are favorable prices.
Funds seek to invest in
companies that…
 Good environmental compliance and performance records
 Safe and healthy work environments
 Responsible corporate citizens abroad as well as at home
 Respect the rights of indigenous peoples
 Produce products that enhance the health or quality of life
 Participate in Philanthropy
 Have sound business ethics policies and practices
And companies that don’t…
 Have recent significant environment fines
 Have human right problems
 Abuse of animals
 Manufacture tobacco products
 Significantly involved in the manufacture of alcoholic
beverages
 Direct involvement in gambling operations
Top companies in fund as of
6/30/08
 FMC Technologies Inc
 Cisco Sys Inc
 CVS Caremark corp.
 Medtronic Inc
 Novartis ag
 Questar corp.
 Microsoft corp.
Pax World Balanced SRI Fund
Erika Nickel
Overview
 Inception: August 10, 1971
 Type of Fund: Balanced Fund
 Minimum Investment:


$250 Individual
$500,000 institutional
 Returns for Current Year: -8.65%
 Yields of Current Year: 1.83%
Objectives
 Financial Stance:
 Seek long-term growth of capital
 Target forward thinking companies with sustainable
business
 Maintain sectors that will increase quicker than the GDP
Societal Concerns
 Stances:
 Protect the environment, further equality, encourage
sustainable development and promote peace
 Restrict:

Animal Testing, Alcohol, Militant Fighting and Weapons,
Gambling & Tobacco
 Seek Out:

Investments with proactive stances on community
investment, community relations, environmental issues,
human rights and labor relations
Investment Advise
 Yes
 Is socially responsible
 Will bounce back from the market falls
Investing in Socially Responsible Funds
Cara Persichetti
The Way You Invest Matters: Be Part
of the Solution
 "triple bottom line“: Not only "investors," they are also concerned
citizens.
 the state of the natural environment, how corporations treat their
workers, and the communities in which they operate
 Domini Social Equity Fund, Domini European Social Equity Fund,
Domini European Pacasia Social Equity Fund, Domini Pacasia
Social Equity Fund, and Domini Social Bond Fund
 Domini 400 Social Index*,SM an index of 400 primarily large-cap
U.S. corporations
Societal Objectives
Ecosystems
Renewable and Alternative Energy Sources
Eco-Efficiency and Resource Conservation
Recycling, Safer Technologies, and Lifecycle Design
Pollution Control and Abatement
Long-Term Environmental Sustainability
Employees
Continuous Improvement in Health and Safety
Fair and Just Compensation and Benefit Programs
Commitments to Diversity in the Workplace
Empowerment and Investments in Training
Solidarity with Unionized Workforce
Investors
Accounting, Credibility, and Business Ethics
Openness in Communications
Commitment to Diversity of Representation
Relationships with Controlling Owners
Suppliers
Labor Practices and Other Human Rights
Quality, Environment, and Other Issues
Diversity Within the Supply Chain
Empowerment and Viability
Societal Evaluations
 exclude from our funds companies with mixed records where negatives
substantially outweigh the positives.
 evaluate these companies case-by-case, looking for signs of
improvement and positive trends.
 sufficient information is usually available to make judgments and
themes that represent goals we believe are reasonably achievable.
 Levels of impact 1(lowest)-5(highest)
KLD Research & Analytics, Inc
Andrew Strick
About KLD
 Year Founded: 1988
 Location: Boston, Massachusetts
 Founder: Peter Kinder (co-founder)
Mission
 To provide global research and index products to facilitate the
integration of environmental, social and governance factors into the
investment process;
 To define, by means of our products and services, accountability
standards that enable investors, managers and fiduciaries to influence
corporate behavior through their investment decisions and share
ownership; and
 To effect, through this influence, greater corporate accountability and,
ultimately, a more just and sustainable world.
Clients
 Not listed on website
 Does give a performance comparison
Screens
 5 sources of information
 Company
 Research partners
 Media
 Public documents
 Government and NGO
 7 qualitative issue areas
 Environment
 Community
 Corporate governance
 Diversity
 Employee relations
 Human rights
 Product quality and safety
Recommendations
Would I buy or recommend KLD Research & Analytics, Inc.?
NO
 Reasons
 Lack of information
 No definitions
 “Window dressing”
Sources
Mission & About KLD
 http://www.kld.com/about/index.html
KLD Founding
 http://www.kld.com/about/BoardOfDirectors.html
Screens
 http://www.kld.com/research/methodology.html
Performance Comparison
 http://www.kld.com/newsletter/archive/press/pdf/200808_Index_Perf
ormance.pdf
Calvert Socially Responsible
Investing
Courtney Hanson
Calvert Socially Responsible
Investing
 Background: Calvert Group
 founded in 1976 is headquartered in suburban Washington, D.C
 400,000 investors in Calvert with over $14 Billion in assets.
 Double Diligence research process approach emphasizes rigorous
fundamental research and a thorough assessment of corporate
integrity.
 Core belief - corporations and mutual funds should be governed and
managed for the benefit of their shareholders.
Equity Portfolio
 3 share classes
 Class A inception 8/24/98 (4.75%)
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Minimum
Initial investment $1,000
Class B 3/31/98
Subsequent
investment $250
Class C 3/1/94
The portfolio invests primarily in the common stocks of U.S.
Large-cap companies.
Atlanta Capital Management Company analyses and identifies
high-quality, growth stocks that are favorable prices.
Funds seek to invest in
companies that…
 Good environmental compliance and performance records
 Safe and healthy work environments
 Responsible corporate citizens abroad as well as at home
 Respect the rights of indigenous peoples
 Produce products that enhance the health or quality of life
 Participate in Philanthropy
 Have sound business ethics policies and practices
And companies that don’t…
 Have recent significant environment fines
 Have human right problems
 Abuse of animals
 Manufacture tobacco products
 Significantly involved in the manufacture of alcoholic
beverages
 Direct involvement in gambling operations
Top companies in fund as of
6/30/08
 FMC Technologies Inc
 Cisco Sys Inc
 CVS Caremark corp.
 Medtronic Inc
 Novartis ag
 Questar corp.
 Microsoft corp.
Pax World Balanced SRI Fund
Erika Nickel
Overview
 Inception: August 10, 1971
 Type of Fund: Balanced Fund
 Minimum Investment:
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$250 Individual
$500,000 institutional
 Returns for Current Year: -8.65%
 Yields of Current Year: 1.83%
Objectives
 Financial Stance:
 Seek long-term growth of capital
 Target forward thinking companies with sustainable
business
 Maintain sectors that will increase quicker than the GDP
Societal Concerns
 Stances:
 Protect the environment, further equality, encourage
sustainable development and promote peace
 Restrict:
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Animal Testing, Alcohol, Militant Fighting and Weapons,
Gambling & Tobacco
 Seek Out:
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Investments with proactive stances on community
investment, community relations, environmental issues,
human rights and labor relations
Investment Advise
 Yes
 Is socially responsible
 Will bounce back from the market falls
Walters
Section 1
Tim Walters, Chris Schuler, Sabrina Linden and Steven Timperio
Mennonite Mutual Aid
 Roots in the Anabaptist Church
 “Church communities putting faith into action by
sharing resources with each other”
 Attempt to maximize investment returns subject to
the principles of socially responsible investing.
 Offices in Goshan, Indiana
Stewardship Investing
 Uses set of core values to determine which companies
they will invest with
 Search for “Ideal Corporate Behavior”
 Respect Basic Human Rights
 Cultural Diversity
 Peace and freedom from violence
 Community Involvement
 Long term environmental Health
Stewardship Investing
 Won’t do business with companies they believe don’t
meet these core values
 Alcohol, tobacco, gambling
 Careful consideration to animal testing
 Abortion specific products
 Military and weapons
Community First
 Have a background of communities supporting each
other
 Supportive and involved with community
 Dedicate 1% of portfolio to community investments
 Also have proactive approaches to human rights, equity
and employment, labor relations, product and service
related investments
Portfolio 21
 Mission Statement
 We designed Portfolio 21 to address the ecological
risks and opportunities of the investment process in
the 21st century
Evaluation Criteria
 Business Models: Lean Manufacturing/Regional
Distribution Centers
 Impacts of Products/Services: Product Life Cycle
Analysis, Recycling Programs
 Investments: Research and Development of
ecologically superior products
Evaluation Criteria Cont.
 Leadership: Views ecological sustainability as
opportunity. Support environmental legislation and
regulation
 Environmental Management: Internal Controls on
environmental impacts and liabilities, 3rd party
evaluation of EMS
 Environmental Risks and Liabilities: Strategic
planning to reduce greenhouse gas emissions
Selective Investments
 Alcohol – No screening
 Smoking – No Investment
 Gambling – Restricted investment
 Weapons/Defense – Restricted Investment
 Animal Testing – Restricted Investment
 Products/Services – positive investment
 Environment – positive investment
Future Sustainability
 The goal is to support companies who provide the
essential functions of meeting human needs without
diminishing nature’s ability to support our economy
in the future.
American Trust Allegiance
 American Trust is an independent trust company
chartered in 1991 in New Hampshire.
 Provides investment management and trust services
for individuals and institutions.
 Manages two socially responsible mutual funds.
American Trust Allegiance
American Trust Energy Alternatives Fund (ATEAX)
 Focuses on companies leading the transition from
carbon based energy to renewable energy.
 Investments in this fund include foreign securities and
many smaller companies, both of which are high risk.
American Trust Allegiance
 American Trust Allegiance Fund (ATAFX)
 Established in March 1997.
 Broadly diversified growth fund with a large cap.
 Screens out alcohol, tobacco, pharmaceuticals and gaming stocks.
 Invests in small and medium capitalization companies and may
avoid investments for social reasons when it is otherwise
disadvantageous to do so.
American Trust Allegiance
 In addition to its two socially responsible mutual
funds, ATA also works individually with clients on
personal socially responsible portfolios.
 Also provides services such as Trusteeships and
securities analysis.