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Principle 11: Socially Responsible Investment, Patient Capital and Carbon Disclosure

Socially responsible investment (SRI) has become a highly effective tool for changing business, proving to investors and CEOs alike that doing good in the world can also help a company do well. A surprising percentage of investment dollars now go into various sorts of socially responsible funds, and many of those funds out-perform their more mercenary competitors.

Part of the conversion process to becoming a believer in SRI involves learning to trust a slower pace of return on investment (though larger end result). As Joel Makower previously wrote, Much like its gastronomical brethren movement, slow food, patient capital is a backlash against institutionalization -- in this case, of money as a means of earning, well, a fast buck. Rather, say its adherents, money should be a means of creating wealth -- the kind that enriches society, the environment, and our collective soul just as much as investors' financial standing.

In order to know that businesses really are balancing the pursuit of profit with environmental and social responsibility, transparency is essential. Again here, investors can be a driving force in changing companies' behavior around transparency, and one way they've done it is to collectively demand disclosure of CO2 emission information from corporations around the world. Transparency, it turns out, is also a great way to reduce the risk of the kinds of corporate corruption and criminality that have made headlines so often over the last decade.

The Transcommercial Enterprise

Social Investment, Social Capital and Social Action

Carbon Disclosure Project

Is Capitalism Growing More Socially Conscious?

Time for True Market Reform

The Restless Growth of 'Patient Capital'

Socially Responsible Exit Strategies: Cashing In vs. Selling Out

Socially Responsible Investment Making Bank

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Transparency is indeed one of the most important parts of the sustainability movement. Much as the Toxics Release Inventory (TRI) part of the Clean Water Act made polluters more accountable to local populations, Carbon Disclosure and investment transparency can make all the difference. Unfortunately, the investment transparency issue has become harder than it has been in the past.

At Middlebury College, where students have been pushing transparency for the endowment, new mutual funds that include hedge funds and other opaque investments have blocked most efforts. Students who are trying to get companies to be more transparent with their carbon emissions, social responsibility and sustainability reporting are being blocked by Wall Street. Even the trustees don't even know what they're investing in!

Instead of becoming more transparent and democratic, the investment world is going the other way. Check out for more information about endowment transparency.

Posted by: Phil A. on 21 May 07

We are in a hurry. The hurry is: we humans are in the process of destroying our planet. Global warming is the single most significant environmental crisis the world community has ever seen. The 2007 G8 Summit in Germany will focus on the reversal of global warming. President Bush, of course opposes this proposal. Like his strategy in the Middle East, he has a better idea, and he wants to convince the world of something they already know is untrue. This time it’s not that there are weapons of mass destruction in Iraq, but that global warming is not that dire an issue.

Our Nero-like President fiddles, but we cannot allow our Rome to go up in flames. This isn’t a city’s destruction we speak of. It is the end of all of us, of history, of every thought and feeling humankind ever produced. Our present federal government is not going to do anything about this crisis.

Our company, Connecticut Real Estate and Construction wishes to do something about it, because Connecticut needs workforce housing in significant number for very important reasons. Suburban sprawl is killing the environment. When we continually clear off two acres and more per household to put up large houses, we cut down trees which produce oxygen, we deplete the filtering system for our water, and we make houses which leave a carbon footprint which further opens a hole in the ozone. If we instead build multiple units together and build them with solar photovoltaic cell panels and with geothermal heating and cooling, we leave virtually no carbon footprint, we leave sufficient greenery to filter water run-off, and we provide our workforce with housing that allows them to stay in the state and not flee to the South and Southwest as has been the recent trend. As a result, those businesses (and their tax revenues) which require those workers need not flee with the workforce, a trend we have seen throughout the Northeast region of the country.

Additionally, we will build elderly housing. The Boomer Generation is aging. They are retiring at record rates and require specific housing that does not exist in sufficient number. We will build it. We will build commercial buildings and office space to go along with the elderly and workforce housing. We need cooperation from local governments to achieve our goals, and we need that cooperation quickly. As we move forward, we will build with town tax rolls in mind. We are aware that the workforce housing will require significant services and expenses, most notably educational expenses. This is why mixing the elderly housing with the workforce balances the ledger, for the elderly pay taxes without sending children to schools. Further, the commercial and office buildings will bring in significant tax revenues without pulling out revenues from the local municipality. This formula is referred to as “Smart Growth” and is to be part of our plans.

While proposing “caution” and “care” is never foolhardy advice, studies on these issues have already been done and “smart growth” is necessary throughout the state. We cannot wait. The cost is too dear for all of us to sit idly by and fiddle away time as the planet goes up in flames.


Miles J. Shapiro, Partner
Connecticut Real Estate and Construction
VP Marketing and Commercial Real Estate

Posted by: Miles Shapiro on 6 Jun 07



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