I remain foggy about how social investing changes corporate behavior. By what metrics has all this social investing succeeded in doing anything more than moving money to one set of money managers rather than another, or from one set of funds inside an investment company to another set of funds? Can any money manager show that a single Fortune 100 company has been fundamentally reformed through the manager's efforts? Proof is not needed of results because social investing is an exercise in hypocrisy. Truly, we want delusion. We want to buy stock in companies whose price goes up and we want the delusion that we are good people. We are like consumers who eat red meat, but prefer not to see the butcher's bloody hands.
So, how do you invest your own capital for a socially helpful return? You've laid out what's wrong. You've said it's hypocrisy. But what's your positive answer to wanting to make a world better? I think outfits like Benetech are one kind of solution. What do you think?
John at All Things Fundraising
Posted by: John | February 02, 2008 at 05:50 PM
Thanks for stopping by, John. I do not claim to have an answer, within the context of an unchanging system, diddling at the edges with atomized investor and consumer choices. If there are answers they would have to be in scale with the problems, such as environmental depletion and collapse. Benetech seems a noble effort. A nonprofit, though, right? I was talking here more about socially conscious funds that invest in for profits. Donating that money to nonprofits is a whole other question. For that the investor does not get a financial return.
Posted by: phil | February 02, 2008 at 06:42 PM