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Following through on President Barack Obama's plans to combat climate change and boost energy productivity, the U.S. Department of Agriculture on Sept. 18 announced it is providing $68 million in funding for 540 renewable energy and energy efficiency projects around the nation.

Agriculture Secretary Tom Vilsack announced the funding while visiting North Carolina to highlight USDA's investments in rural renewable energy projects. He emphasized the economic, as well as social and environmental, benefits government support and stimulus is having in the young but fast-growing renewable energy and energy efficiency sectors.

"These loan guarantees and grants will have far-reaching impacts nationwide, particularly in the rural communities where these projects are located," Vilsack said. "Investing in renewable energy and energy efficiency will continue the unprecedented increase in home-grown energy sources and American energy independence we've seen in recent years. This is creating jobs, providing new economic opportunities and leading the way to a more secure energy future."

$68 million in USDA funding for 540 projects

The $68 million in funding is being provided via USDA's Rural Development's Rural Energy for America Program (REAP).  REAP was created via the 2008 Farm Bill. The program was reauthorized by the 2014 Farm Bill, which recently passed into law, USDA notes in a press release.

“REAP has supported more than 8,800 renewable energy and energy efficiency projects nationwide,” USDA highlighted. “During this period, USDA has provided more than $276 million in grants and $268 million in loan guarantees to agricultural producers and rural small business owners.”

This latest announcement of DOA funding for renewable energy and energy projects is the latest in a series of funding announcements that follow through on President Obama's “all of the above” energy strategy.

Funding for bio jet fuel production

Two weeks ago USDA announced a $105 million loan guarantee for Fulcrum Sierra Biofuels LLC – the first loan guarantee USDA has made for the production of bio jet fuel. The loan guarantee will facilitate Fulcrum's ability to secure bank financing to build a bio-refinery in McCarran, Nevada, that is to produce jet fuel from municipal solid waste.

Commenting on the Fulcrum Sierra Biofuels loan guarantee while speaking at the National Clean Energy Summit 7.0 in Las Vegas the week of Sept. 4, Secretary Vilsack said:

"This represents a huge step forward in the development of clean, renewable, job-creating American fuels," Vilsack said during a speech at the National Clean Energy Conference. "The nation is entering a new energy age that will make us more energy independent, cut carbon pollution and strengthen our economy, especially in rural communities where clean fuels will be produced."

New solar commitments and executive actions

The USDA's announcement also came on the same day President Obama announced new executive actions and commitments from organizations around the nation to continue advancing development of solar energy technologies.

On Sept. 18, the White House announced “a series of public and private sector commitments and executive actions to advance solar deployment and promote energy efficiency.” Elaborating, the White House listed them as follows:

• Partnering with up to three military bases to create a veterans solar job training pilot;


• Investing $68 million in 540 renewable energy and energy efficiency projects in rural areas across the country, including 240 solar projects;


• Proposing an energy conservation standard for commercial unit air conditioners that has the potential to save more energy than any previously issued standard;


• Supporting funding for clean energy and energy efficiency for affordable housing;


• Strengthening commercial and residential buildings codes; and


• Harmonizing the power of national service and volunteerism to tackle climate change and its effects.

All told, these executive actions and commitments are expected to reduce carbon pollution by some 300 million metric tons through 2030. That's equivalent to taking more than 60 million cars off the road for one year. It will also save on energy bills for homes and businesses to the tune of over $10 billion, the White House highlighted.

Joining with the president and his administration, 50 companies, states, communities and leaders in the field of multi-family housing pledged to deploy over 35 megawatts' (MW) worth of solar energy systems and improve energy efficiency. That's enough to power thousands of U.S. homes. Their energy efficiency commitments, moreover, should lower energy bills spanning over 400 million square feet of office space, according to the White House.

*Images credit: 1), 2) USDA; 3) SEIA, GTM Research

In 1981, the United Nations Educational, Scientific and Cultural Organization (UNESCO) designated Australia’s Great Barrier Reef a World Heritage Site.  Just 25 years later, however, UNESCO warned that climate change and other anthropogenic causes were threatening the reef’’s existence.  In fact, according to a 2012 report by the Australian Institute of Marine Science, the reef has lost over half of its coral in the past quarter-century.

Earlier this year, UNESCO’s World Heritage Committee noted that conservation efforts at the reef were making some progress, but that significant dangers still remained.  The committee encouraged the Australian government to submit an updated progress report by early 2015, which the committee would consider when determining whether or not the reef deserves placement on the List of World Heritage in Danger.

Earlier this week, the Australian and Queensland governments released a draft of the Reef 2050 Long-Term Sustainability Report, which they hope will allay UNESCO’s concerns.  Critics, however, think bolder action is required.

What’s happening to the Great Barrier Reef?

In short, the reef is threatened by a combination of unabated climate change, coastal development, and overuse/pollution.

Climate Change.  In its 2007 report on the effects of climate change on World Heritage sites, UNESCO noted that the global warming-related risks to the Great Barrier Reef are manifold.  Some of the biggest risks include sea-level rise, sea temperature increase, storm frequency and intensity, ocean acidity, and, most threatening, "coral bleaching."

Coral bleaching occurs when the warming of sea-water temperatures causes coral to expel the nutrition-providing algae that grows on the coral’s skin.  According to projections made at the time of the 2007 UNESCO report, warming in the Great Barrier Reef Region -- likely between 2 degrees and 5 degrees Celsius by 2100 -- will result in more frequent “mass bleaching events,” leading to widespread death of corals.

Development.  Perhaps most troubling has been the Australian government’s willingness to allow development along the reef. Earlier this year, the Australian and Queensland governments granted approval for the dumping in Reef waters of 4.5 million tons of dredged material as part of the expansion of the Abbot Point coal port terminals, which sit on the edge of the reef and serve as the major docking points for coal from the Galilee Basin.  Outcry from conservation groups led to the Abbot Point developers ditching the plan to dump the spoil into the sea, instead opting to deposit it on land (which raises its own set of issues).  Yet, dumping aside, Abbot Point development will continue.  In fact, as the Queensland government itself admitted, new coal mining projects will continue to emerge in the region, likely resulting in a need to further expand the coal export capacity at Abbot Point beyond initial projections.

Overuse/pollution.  The Great Barrier Reef is one of the world’s natural wonders and its exploitation as a tourist attraction is vital to the Australian economy.  For instance, visitation to the Great Barrier Reef Marine Park in 2013 amounted to approximately 2.09 million visitor days.  International consulting firm Deloitte calculated that, in 2012 alone, the reef contributed $5.7 billion in net economic value and was responsible for just under 69,000 full-time jobs.

Although UNESCO noted that tourism in the region is relatively well-controlled and not a significant contributor to reef-wide degradation, it concluded that increasing use still poses a threat to individual sites within the reef, particularly when accompanied by discharge of vessel waste and excessive fishing -- to say nothing of the impact of land-based pollution, including fertilizer, herbicide, pesticide and human sewage runoff.

Australia’s plan

In response to UNESCO's warning, the Australian and Queensland governments released a draft of the Reef 2050 report earlier this week.  The report, which will be subject to public consultations until Oct. 27, does some things well:  It includes greater protections for marine life; aims to improve water quality by reducing the amount of pesticides that wash into the reef; and rules out port development in certain areas (not including Abbot Point).

However, the report stops short of minimizing dredging and banning dumping within the Great Barrier Reef World Heritage Area, which groups like World Wildlife Fund-Australia have urged.  In addition, the WWF has criticized the report for failing to “provide the billions of dollars required to restore the health of the reef” and ignoring “the significant weakening of state environmental laws.”  Felicity Wishart, Great Barrier Reef campaign director at the Australian Marine Conservation Society, called the plan "too little, too late” and characterized it as a missed opportunity.

Australia’s failure mirrors society’s -- but there's hope

A common criticism of the 2050 Reef report is that the dire situation at the reef requires bolder action.  In other words, the same criticism that could be leveled against our society in the face of the devastation likely to be wrought by global warming.

It's no secret that, despite the clear and growing threat posed by climate change, the problem continues to worsen and our leaders dither.  We’re spewing more carbon dioxide than ever into our atmosphere, while the extractive industry continues to spend astronomical sums in search of hydrocarbons that they will never be able to safely burn.

Yet, with bold action there may be reason for hope.  This Saturday, for example, 100,000 people will march through Manhattan in an unprecedented effort to draw attention to the problem of climate change.  The People’s Climate March is being billed as the largest climate march in history, and has already drawn the support of a diverse group of over 1,400 businesses and nonprofit organizations.

Second, as Naomi Klein argues in her new book, we can use the project of saving our planet to simultaneously advance policies that improve lives, combat income inequality, create real jobs and reinvigorate grassroots democracy.  Klein calls this a “people’s shock,” a play on the theory of her last book, "The Shock Doctrine," which argued that rights are most vulnerable in the wake of “shocking” events, like 9/11.   To Klein, the climate crisis poses the opposite possibility: a chance for sweeping progressive action.

If we can, as Klein puts it, use the fight against climate change to “right [society’s] festering wrongs at last,” then perhaps there is reason for hope.  In the meantime, you can join Saturday's march and help save the Reef.

Image credit: Flickr/farbenfrohewunderwelt

Some of the world's top politicians will meet in New York City this week to discuss global temperatures. If they want any proof that climate change is impacting the globe, they only have to look at the map.

The People's Climate March, which was organized for Sunday, Sept. 21, to coincide with a U.N. climate meeting in New York City this week, is now set to take place in more than a hundred locations across the globe. Host cities range from San Francisco to Alausa Lagos, Nigeria. Even smaller events, designed to reinforce the global nature of concern, have sprung up in cities on every continent.

But, as is often the case, the largest attractor to this cause may be the names that are lending their weight to the march. More than 50 celebrities, from Prince Albert II of Monaco to actors like Willem Dafoe, Susan Sarandon and Brad Pitt, are stepping up to support the effort -- which has garnered the endorsements of more than 1,000 environmental, labor and civil rights organizations.

Organizations like Greenpeace, Natural Resources Defense Council, Sierra Club and Avaaz.org are organizing bussing and scheduling marches. For those who can make it to New York, more than 1,400 businesses are getting involved, as the Big Apple gears up for likely the largest environmental statement to take place across the globe.

Organizers have also put a fair amount of attention into tailoring the march to meet the talents and interests of all attendees, perhaps in an effort to correct one of the key problems that activist marches experience when trying to recruit supporters: disillusionment.

“A lot of people tune out because they feel hopeless,” Canadian author Naomi Kline observed in a recent interview. To counteract that, the organizers have included interactive searches on the People's Climate March website to inspire artists, musicians, activists and others to find their niche and get involved.

It will be interesting to see what impact the march has on world leaders and the gridlock that has manipulated climate talks in the past. One thing is for sure: Most U.N. leaders won’t leave the climate change dialogue in New York when they head home. And that may be the greatest positive outcome of Sunday’s Climate March --which aims to “bend the course of history” -- when it comes to climate change denial and the perception that global warming is an elusive phenomena that can be ignored.

Image credit: People's Climate March

By Marta Maretich

We were all waiting for it. Now, at last, it’s here.

The Social Impact Investment Taskforce report hit the media on Sept. 15, provoking a small flood of news stories and reaction pieces from governments, development agencies and third-sector bodies.

At 51 pages (not including the eight individual country reports), The Invisible Heart of Markets is a hefty document in more ways than one. It was authored by group of heavyweights including government ministers and the heads of impact organizations from around the world, led by prominent social finance advocate Sir Ronald Cohen. Its editor, Matthew Bishop, is a respected author and writer for the Economist. Even Pope Francis apparently lends his support to the project with a bullish opening quote.

Everything about the report signals its significance not only to the social investing sector but also to the worlds of finance, philanthropy and public policy, all of which will be touched by its far-reaching recommendations. It gathers together what has been until now a scattered picture of the many strands and branches and offshoots of impact, and brings a practical focus on where we all need to go from here. Accordingly, commentators from various parts of the sector are beginning to weigh in on the report’s ramifications in areas like development, the role of government, the future of philanthropy and even crowdfunding.

All this makes the taskforce report a success. Its ambition, its scope, its polish — not to mention the evident political clout that lies behind it — are further signs that impact has arrived. It is a milestone in the evolution of our sector and its effect will be significant and lasting. Sector watchers (myself included) will be mining its rich content for months to come, as well as tracking the progress toward the goals it dares to lay out.

Where change really comes from

And yet, in the dazzle of the report’s many authoritative recommendations for governments, policymakers an impact sector leaders, there’s a danger of overlooking a vital detail: real change doesn’t come from institutions or governments, nor does it come in the form of policies, manifestos or even laws. These things are necessary for the growth of our sector now, as the report neatly demonstrates, but they are just expressions of a more profound shift that will be needed if impact is to fulfill its potential.

Because real change comes from people, from the things they believe — their values — and from the decisions they make as a result of those beliefs. In organizations, whether businesses, foundations or ministries, significant change happens when those who are accountable for making strategic decisions, such as top managers, management teams and trustee boards, change the way they think.  In public life, change arises when many individuals alter their thinking along with their voting patterns.

It is to these incremental, individual shifts of belief that we owe the progress of the social investing movement so far. Its early advocates, including Cohen, have been persuasive, even charismatic, and the taskforce report is a measure of how far they’ve brought things in just a few years. Its agenda is ambitious and, if we realize its vision, there’s no doubt that impact investing will move into the mainstream and become more widely practiced.

But will it really mean anything? Will anything really have changed as a result? That depends.

Change is what impact investing is all about. It is market finance with a transformative social purpose. The top-down measures proposed by the taskforce report are needed, but without a corresponding change in the attitude of the decision-makers inside many organizations, they aren’t enough to turn impact into the force for global change we hoped it could be. And without more public engagement by small “retail” investors, impact investing is destined to remain the hobby of a small financial elite, rather than become, as it might, a true evolution of market finance.

The heart of the matter

The report acknowledges this in some measure and its recommendations, such as clarifying the fiduciary responsibilities of trustees, could really help. But the questions remain: How do we change minds when it comes to impact investing? How do we convince a skeptical financial sector (and it still is skeptical, despite positive noises) that impact is more than just the flavor of the month? How do we empower business leaders and governing bodies to embed their values permanently in their strategy and give them the support they need to follow through?

These questions can’t be fully answered through better policy, more data or even good regulation, although those things can help create a climate where answers can be found.  To get to the heart of the impact market we have to find ways to touch its human sources, to change the minds of people and the dynamics of decision making groups.

This won’t be simple.  We’ve only started down the road toward a new financial future and there’s still a long way to go. But it's beneficial to remember that the hardest part of the journey will not be creating new market systems and infrastructure (though that won’t be easy). Rather, it will be changing the way we all think about finance and how it can be used to create beneficial outcomes for people and the planet.

If we can manage to change our mindset, realizing the rest of the taskforce's vision will seem like a piece of cake.

Image credit: Flickr/audiinsperation

Marta Maretich writes about impact, sustainable and social investing for Maximpact.com, a deal listing portal and information hub for the new finance sector. She is Chief Editor of the Maximpact blog.

Dunkin’ Brands Group, the parent company of Dunkin’ Donuts and Baskin-Robbins, announced its commitment to source only 100 percent sustainable palm oil for its U.S. locations by 2016. Less than a day after Dunkin’s announcement, Krispy Kreme also committed to source 100 percent responsibly produced palm oil.

Dunkin’ Brands will work with its suppliers and its franchisee-owned purchasing cooperatives to source palm oil that's 100 percent fully traceable to the mill by the end of 2015, and to the plantation by the end of 2016 for its Dunkin’ Donuts U.S. restaurants. By March 1, 2015, Dunkin’ Brands will develop and publish a phased implementation plan.

Dunkin’ Brands will require suppliers to adhere to certain standards, including:

• No development of high-carbon stock forest and high-conservation areas


• No burning in preparation of land or in development


• Progressive reduction of greenhouse gas emissions on existing plantations from all sources


• No development on peat areas


• No exploitation of people and communities

Forest Heroes activists pressured Dunkin’ Donuts to commit to sourcing sustainable palm oil. A campaign that called on Dunkin’ to 'be a Forest Hero' culminated in activists attending the company’s shareholders meeting in Quincy, Massachusetts in May. While Forest Heroes is happy with Dunkin’s announcement, the nonprofit expressed concern that the commitment only extends to the U.S. and not beyond. The company will not determine the international timeline until March 2015 after it has mapped its international supply chain. Forest Heroes states that it will be “urging Dunkin’ to review its international supply chain as quickly as possible and implement an equally strong commitment abroad.”

Krispy Kreme’s commitment goes further

Krispy Kreme’s commitment goes further than Dunkin’ Brands as it sets a deadline for compliance globally. Forest Heroes calls the company’s commitment a “race to the top.” Krispy Kreme states on its website that its commitment to source sustainable palm oil started in January with a commitment to source palm oil only from suppliers certified by Roundtable on Sustainable Palm Oil (RSPO) for its U.S. locations. Now, the company is committing to achieve 100 percent responsible sourcing of palm oil worldwide. By the end of 2016, all of the company’s palm oil will come from RSPO certified sources, RSPO mass-balance, mixed-source supply and GreenPalm certificates purchases. All of Krispy Kreme’s suppliers will be required to trace their palm oil to plantations that protect forests and peatlands, don’t exploit  communities and workers, and comply with RSPO principles and criteria.

Palm oil industry causes environmental destruction

Palm oil is a $50 billion a year commodity and is found in half of all consumer goods. About half of the world’s palm oil comes from environmentally destructive sources that cut down rainforests and destroy peatland. Companies have cleared more than 30,000 square miles of forest to make room for palm oil plantations. Between 1990 and 2005, 55 to 60 percent of palm oil expansion in Malaysia and Indonesia, the world’s top palm oil producing countries, caused virgin tropical forests to be cut down. As a result, Sumatran tigers and orangutans are on the brink of extinction.

Image credit: Krispy Kreme

This video is part of our ongoing coverage of SOCAP14.  To see the rest please visit our SOCAP 14 page here.

Scott Anderson is managing editor of Nextbillion.net, a website and blog bringing together the community of business leaders, social entrepreneurs, NGOs, policy makers and academics who want to explore the connection between development and enterprise.   In this clip Scott talks about his experience at SOCAP14 and the state of social enterprise as well as some new developments at Nextbillion.

By Sanaz Arjomand

Why are an expected 100,000 people hitting the streets of New York City this Sunday? To learn more about the strategic thinking behind the upcoming People’s Climate March, the Bard Center for Environmental Policy sat down with 350.org’s U.S. Campus Field Manager, Jenny Marienau.

This Q&A is an edited excerpt from the National Climate Seminar. Bard CEP’s twice-monthly dial-in conversation features top climate scientists, policymakers and activists. The complete podcast of the interview is available here.

Bard CEP: What planted the seed for the People’s Climate March?

Jenny Marienau: About a year ago, United Nations Secretary General Ban Ki-moon called a meeting of world leaders to talk about solutions to the climate crisis. The People’s Climate March was planned as a way to take advantage of that national stage to demonstrate the power of the climate movement. We tried to bring together all of the different constituencies involved, to flex the climate movement’s muscle and let it see itself all together, marching in the street.

Bard CEP: How many people are participating?

Marienau: We’re hoping to be one of the largest marches in the climate movement’s history with upwards of 100,000 people participating. All 50 U.S. states will be represented at the march. There are 374 buses and trains listed to come to the march.

The march itself is a project of over 1,100 groups, including faith groups, climate action groups, groups of parents and public interest law centers. They have organized events all around the march as well as the march itself. Because it’s such a broad coalition, there isn’t one ask or one set of demands other than the very broad sentiment: “We want to see climate action now.”

Bard CEP: What was the process for building the coalition for the march?

Marienau: Folks with an interest in taking action on climate have come together in a series of groups. For example, a group from New York City with goals and asks for New York City came together and did some planning at their own table. There was also a youth table of folks who represent high school and college students and young organizers. Different interest groups coalesced to come up with their particular interests in the march. Then those tables of people came together to design the overall group march as part of an open call. The effort has been not to have 350.org leading the organizing of the march, just leaving space for a larger coalition to put it together.

Bard CEP: What will success at the People’s Climate March look like?

Marienau: For me, it will really be the quality of organizing that comes out of it. Yes, the march is a referendum on where the U.S. stands on climate action, but in terms of the power that we’re building, how we go to the march in coordinated groups and how we come out of it with clear next steps for our communities is the best measure of success.

Bard CEP: What past lessons learned have been applied here?

Marienau: One important lesson was learned in a fairly crushing way around [the] 2009 climate bill. Almost everyone in the nonprofit climate organizing sphere was putting all their energy into this bill that failed to pass. There was a vacuum created in that “all-in-one solution” type of organizing — because when your silver bullet fails to hit the target, what else is there? I think that’s where this patchwork style of organizing originated. We don’t have one solution to the climate crisis, and top-down solutions are not always the best option. Community-based solutions that really work for people in their hometowns are an important — maybe the most important — piece of our organizing.

Bard CEP: What should interested parties be doing between now and the march?

Marienau: Check out the People’s Climate March website. You can find events in your area or transportation shares to the march. Once you’ve figured out where you’re going and how you’re getting there, invite your friends, invite your faith community, invite everyone you know. Social media is a great way to spread the word, as are posters in coffee shops. Finally, decide who you want to meet and make a plan to do that; there are lots of events where you can network in a more focused way listed on the events board.

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Bard CEP will be hosting an open house along the route of the People’s Climate March. If you would like to take a break from the march and get an “aerial view," please stop by our classroom at 1150 6th Avenue, 5th Floor, between 1:00 p.m. and 4:00 p.m.

The next edition of the National Climate Seminar, at noon eastern on September 24, features Dr. Robyn Smyth on “The Next Toledo: Algal Blooms and Climate Change." Click here for dial-in information.

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Image credit: People's Climate March. Click here for more shareable graphics. 

Sanaz Arjomand is a graduate student in the MS Environmental Policy Program at the Bard Center for Environmental Policy.

Besides denying that fossil fuel use is rapidly pushing civilization to a climate change tipping point, climate-change deniers contend that the costs associated with making climate change mitigation and adaptation a global priority would stifle economic growth and social development.

In advance of the U.N. Climate Summit and Climate Week NYC, which kicks off on Monday, some have even asserted that the campaign to reduce greenhouse gas emissions is a conspiracy aimed at gathering wealth and political power. Some might reply that this is a glaring example of “the pot calling the kettle black.”

Research studies from reputable, independent organizations, such as the landmark Stern Review, have concluded that the costs of inaction greatly outweigh the costs of addressing climate change head-on. A new study commissioned by the Global Commission on the Economy and Climate goes further, asserting that growth can not only be achieved, but enhanced, by following pathways that will result in societies that are socially and ecologically, as well as economically, sustainable.

Climate change action and the path to prosperity

The Global Commission on the Economy and Climate was established in 2013 by the governments of Colombia, Ethiopia, Indonesia, Norway, South Korea, Sweden and the U.K. “to help governments, businesses and society to make better-informed decisions on how to achieve economic prosperity and development while also addressing climate change.”

“Better Growth, Better Climate: The New Climate Economy Report” is the result of the research group's flagship project. It was carried out by the World Resources Institute (WRI) in collaboration with the Climate Policy Initiative, CRIER, Global Green Growth Institute, LSE Cities, Stockholm Environment Institute, Ethiopian Development Research Institute and Tsinghua University.

According to the report:

“The report’s conclusion is that countries at all levels of income now have the opportunity to build lasting economic growth at the same time as reducing the immense risks of climate change.”

A deep structural transformation

Getting there won't be simple, easy or quick, however, the report highlights. Doing so will require “a deep structural transformation” and technological changes that are already ruffling feathers and prompting fierce opposition from vested commercial and political interests – mainly the fossil fuel producers and power utilities whose businesses and profits are directly threatened.

Nonetheless, all the pieces are in place to drastically reduce global greenhouse gas emissions by shifting from fossil fuels to a distributed mix of locally-appropriate renewable and clean energy resources. Doing so, moreover, will result in more robust and resilient infrastructure, economies and sustainable societies. It would also open up vast new opportunities for economic and social development that, given appropriate government policies, can result in rising prosperity across all levels of society, report authors assert.

“The capital for the necessary investments is available, and the potential for innovation is vast. What is needed is strong political leadership and credible, consistent policies,” they highlight.

A critical 15-year window of opportunity

The next 15 years will be the critical window of opportunity for governments, businesses and societies to invest aggressively in climate change action that takes a holistic, integrated approach in addressing challenges spanning the water-food-energy nexus, the report's authors continue.

“It will not be 'business as usual.' The global economy will grow by more than half, a billion more people will come to live in cities, and rapid technological advance will continue to change businesses and lives,” they point out.

The New Climate Economy project team expects some $90 trillion is likely to be invested in infrastructure associated with urban, land use and energy systems worldwide over the next 15 years. “How these changes are managed will shape future patterns of growth, productivity and living standards,” they caution.

Image credits: Better Growth, Better Climate: The New Climate Economy Report

Featured image: Flickr/squeaks2569

Editor’s Note: This article originally appeared in “The Millennials Perspective” issue of Green Money Journal. Click here to view more posts in this series.

By Barbara Krumsiek

During my first week at Calvert Investments as president and CEO in April 1997, I received a desk plant as a congratulatory gift from a former colleague. Seventeen years later, that plant is literally a tree, dominating a special corner of my office. It is a daily reminder of not only my personal journey at Calvert, but also the flourishing of sustainable and responsible investing over the past several decades. What began as a niche approach is more and more a mainstream investment strategy.

As an industry, we undoubtedly play a major role in promoting changes that will help shape a global green economy, add more diversity in the highest echelons of corporate governance and serve as the watchdogs of human rights in the business context.

But as we think about both where we’ve come from and where we’re going next, it’s critical to balance our attention to these major global movements with some of the day-to-day tasks within the industry that are necessary to advance these global objectives.

Reinventing socially responsible investment

In the early years of the sustainable investment industry, most companies did not recognize sustainability as a materially-relevant concept. As time passed, some companies warmed to the concept. Today, the paradigm has shifted again and many companies embrace sustainability. The Governance & Accountability Institute reported that 72 percent of the S&P 500 published sustainability reports in 2013; this is up from 52 percent in 2012 and from 20 percent in 2011.

This shift in the corporate landscape has required asset managers to evaluate and evolve approaches to how we think about the investable universe. Exclusionary investing will always be a part of our industry – particularly for those individuals who feel socially responsible investing (SRI) is the only way in which they want to participate in the capital markets – but new inclusionary and integrated approaches are also valid.

One area that continues to be a hallmark of a true sustainable asset manager is advocacy and engagement. We need to get better at demonstrating how we use our deeper ESG knowledge of companies and our interactions with corporate stakeholders to influence corporate behavior change. While we work to create more sophisticated portfolio approaches, we need more sophisticated ways to measure these impacts as well.

Shifting paradigms offer opportunities. We may even get to reinvent ourselves, as I will do next year. I will remain as Chair on the Board of Directors for Calvert Investments. I will also start my new role as Founding Chair of the Calvert Institute, which will contribute research to support the continued growth of the field of sustainable investing.

Connecting with millennial investors

Findings from Calvert’s most recent Brand Health Study (conducted Q4, 2013) support much of what the July issue of GreenMoney Journal's focus on millennial investors discussed. But one finding particularly exposed a growth opportunity. Financial advisors and their clients (i.e., investors) are not on the same page regarding sustainable investment. This disconnect is evidenced by the fact that 82 percent of advisors reported waiting for clients to raise the topic, while 72 percent of clients indicated they are waiting for their advisor to initiate it.

I believe advisors may be hesitant to bring the topic up because they hold somewhat outdated perceptions of sustainable investing. Advisors indicated that the No. 1 reason they would consider sustainable investing was “to be consistent with my client’s values (82 percent).” Yet investors split their top reason for choosing sustainable investment between: "an opportunity for strong investment performance" (50 percent) and "to diversify the portfolio" (50 percent).

These findings suggest that we, as an industry, are still viewed by financial advisors as not focused enough on financial outcomes. Yet it’s no surprise that clients have let go of that perception and look to sustainability factors as drivers of better portfolio performance. This is demonstrated most strongly right now by the two ends of the spectrum – highly sophisticated institutional investors and relatively new investors – the millennial generation.

Our Calvert brand study also confirmed that younger investors, specifically under the age of 35, are highly receptive to sustainable investing. They are more than twice as likely to invest and 60 percent more likely to have researched/inquired/considered investing in a sustainable mutual fund.

I have a close personal connection with the millennial generation. My two daughters are part of that demographic. As I think about how I can guide the new Calvert Institute to make meaningful contributions to the growth of our industry, I am so motivated by younger investors, whose awareness of environmental issues and innate perspectives on inclusion and diversity will guide their investing choices and make our field even more relevant.

Read Barbara's Complete article here.

Barbara J. Krumsiek is Chair, outgoing President and CEO of Calvert Investments, Inc. Calvert Investments is a leading investment management company using sustainability as a platform to create value for investors. Serving financial advisors and their clients, retirement plans and insurance carriers, and institutional investors, the company offers a broad array of equity, bond, and asset allocation strategies, featuring integrated environmental, social, and governance (ESG) research and corporate engagement. Strategies are available through mutual funds, sub-advisory services, and separate account management. Founded in 1976 and headquartered in Bethesda, Maryland, Calvert Investments had more than $13 billion in assets under management as of 7/31/14.

This video is part of our ongoing coverage of SOCAP14.  To see the rest please visit our SOCAP 14 page here.

Will Poole is the co-founder of Unitus Seed Fund, a $20 million fund based in Bangalore and Seattle that invests in startups serving large, underserved low-income populations.  In this conversation, Will discusses the state of impact investing in India, some of what has made it historically difficult and what's being done to change that.  Unitus has made a great deal of progress since its inception, and Will shared three recent accomplishments with me:

1. With help from high net-worth investors and family foundations, Unitus has completed its first phase of fundraising for its $20M+ fund. These new investors coming to the table show that impact investing is starting to become more of a mainstream investment choice. This trend will continue as more HNIs invest in impact, and as millennials start to put inherited wealth to better use.


2. Unitus has also launched the “India Impact Acceleration Program” to help reach and support entrepreneurs from around the country. Currently, the majority of Unitus' and other private equity investment is going to companies in the south.


3. Unitus has entered into an alliance with the U.S. Global Development Lab to provide substantial support for Unitus’ new India Impact Acceleration Program, which aims to help improve and accelerate the early-stage impact startup ecosystem across India.