A 'passion portfolio' - could we use our personal interests to guide our investments?

Replies to This Discussion

Permalink Reply by Adrian Ashton on December 8, 2011 at 9:26

I think its not only possible, but should be our normal practice  especially given the proliferation of information channels and providers that are now available in this field: for example, I hold a (very) small pension in a fund which only invests in companies that meet certain ethical criteria, my savings are held in co-op bank account - I know that I'm perhaps not making the best return on these, but I'm happy to reconcile that because of the values I hold.

but I also go further than just investments - all household procuring is made using the same vales-based lens: our energy comes from ebico, the only ethically based utilities supplier in the UK; telecoms via the phone co-op and so on. And in my professional practice I also undertake and publish an annual 'social accounts statement' which includes details of how much of my supply chain has been with local firms and how much with social enterprises and co-ops.

interestingly, this issue of values and ethics beuing used to based investment decisions on is also not perhaps as 'clean cut' as it might first seem - I blogged a while back about how pornography is deemd to be more ethical than tobacco by fund managers...http://bit.ly/a6g7zJ

Permalink Reply by Pascale Scheurer on December 8, 2011 at 16:04

Thank you Adrian, it's great to get your examples from home and business life. I will enjoy reading your blog.

What field do you work in? Do you think that your clients take an interest in your ethical approach, and has that changed over time? The reason I ask is that in my architecture practice it became clear around 2003-4 that major developers and investors were further ahead on the CSR front than the architectural profession (apart from a few exceptions who had prior interest in sustainable/green/social design). There may have been an element of greenwash of course, but I remember being genuinely surprised at our research findings. The big corporates were also moving ahead of the public sector clients - who talked the talk but continued to procure on lowest cost.

Best,

Pascale

Permalink Reply by Adrian Ashton on December 8, 2011 at 19:30

thanks Pascale,

I work primarily in enterprise development (in the broadest and most liberal senses of the phrase as you'll see from the portfolio on my website);

ironically, although my publicly holding myself to account over how my values and ethics inform my business practrices has attracted interest from various quarters (and other countries), its never helped me win work or been of interest to any of my  clients to date...

Adrian

Permalink Reply by Pascale Scheurer on December 9, 2011 at 9:52

Adrian ... time to sack your clients?

Only joking.

Have you ever asked clients for feedback specifically on your social accounts statement?

The reason I asked is that sometimes companies hide their ethical light under a bushel. Not you specifically but we did some research on the companies that advertise to our architecture firm - we asked them whether they were doing anything on the social/environmental side. They quite often came straight back with "Oh yes we're doing all these great things." To which we asked "Well why didn't you mention them in your pitch to us, why can't we see them on your website?" Generally, they assumed we wouldn't be interested, so they didn't mention it. Sometimes they had great products but their offer came across as bland and undifferentiated - I think they don't want to put anyone off so they toned everything down to mid-grey.

One particular example that stuck in my mind was a lighting company who had developed plenty of great low-energy solutions but somehow didn't mention them - why wouldn't we just keep going to a market leader like Thorn lighting then? Once we could see that eco + innovation differentiator, we were more than willing to specify their products and help promote their company.

Cheers, Pascale

Permalink Reply by Adrian Ashton on December 9, 2011 at 10:16

hi Pascale - yes, I regularly present my 'accounts statment' to clients when pitching for work as well as where I know it will be of releveance due to their specific interests;

sadly, even though a lot of my work is with social enterprises and the regional and national bodies and programmes that represent them, and agencies seeking to strengthen local economies - they're not that bothered... which is odd given the public messages that they put out about themselves.

perhaps its still too 'early days' for this type of thing and procurment habits are just not there yet? or perhaps ist because work is being commissioned increasingly against the service to be delivered rather than the overall standing and profile of the agency delivering it?

Adrian

Permalink Reply by Pascale Scheurer on December 9, 2011 at 13:33

I completely agree. That's one of the reasons that I'm working in 'Profit with Purpose' rather than public sector.

I wonder whether anyone can explain why the public sector regularly seems to work against its own objectives in this way. Do you have a hypothesis?

Permalink Reply by Tony Cooke on January 6, 2012 at 15:31

In response to your original question - technology will enable this to happen. Already new start-ups are 'crowd-sourcing' investors through Twitter rather than traditional venture capital or business angel networks.

To invest in well established or even listed companies that resonate with your own values will require much greater transparency around a whole range of criteria than we currently have.

My personal interest is in the investment marketplace recognising performance in delivering social and environmental value, but to do so will require the development and adoption of 'industry standard' metrics in the same way as we currently have accounting standards for measuring and comparing companies' financial performance.

If shareholder value became more widely defined as delivering social and environmental returns alongside economic returns, then it would begin to drive much more radical behaviour throughout businesses.

In response to your developing discussion, my own business experience (as a major provider of outsourced services to public and private sector) is that the greatest recognition of our own investment in social and environmental value creation comes from our corporate clients who are looking for a value match from their 'supply partner'. The public sector, with notable exceptions, is still looking for lowest price from a contractor.

Permalink Reply by Pascale Scheurer on January 22, 2012 at 19:50

Thanks you Tony, your points are very useful.

Have you ever used FTSE4Good or GIIRS for investment metrics? GIIRS is USA-based and I believe fairly new, whereas FTSE have been running the 4Good index for a decade or so, with criteria developed in partnership with the UN. Impressive on paper - whether people use it may be another matter. It would be interesting to understand investors' experience of it in practice.

Best regards,

Pascale



Tony Cooke said:

In response to your original question - technology will enable this to happen. Already new start-ups are 'crowd-sourcing' investors through Twitter rather than traditional venture capital or business angel networks.

To invest in well established or even listed companies that resonate with your own values will require much greater transparency around a whole range of criteria than we currently have.

My personal interest is in the investment marketplace recognising performance in delivering social and environmental value, but to do so will require the development and adoption of 'industry standard' metrics in the same way as we currently have accounting standards for measuring and comparing companies' financial performance.

If shareholder value became more widely defined as delivering social and environmental returns alongside economic returns, then it would begin to drive much more radical behaviour throughout businesses.

In response to your developing discussion, my own business experience (as a major provider of outsourced services to public and private sector) is that the greatest recognition of our own investment in social and environmental value creation comes from our corporate clients who are looking for a value match from their 'supply partner'. The public sector, with notable exceptions, is still looking for lowest price from a contractor.