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GreenMoney Journal - publishing since 1992
Fall 2010 issue
Socially Responsible Investing – Better Companies, Better Communities
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ICONS INTERVIEW SERIES - Mark Regier & Laura Berry
Welcome to the second of GreenMoney's new Icons Series, in which we invite Socially Responsible
Investment industry leaders to interview others who have also assumed SRI leadership.
This issue features Mark Regier, Stewardship Investing Services Manager of the MMA Praxis Mutual
Funds interviewing Laura Berry, the newly appointed executive director of Interfaith Center for
Corporate Responsibility (ICCR), a well-respected organization that for almost 4 decades has been
transforming the field of corporate social responsibility. Currently ICCR (http://www.iccr.org ) is
a coalition of nearly 300 faith-based institutional investors, representing over $100 billion in
invested assets.
Both Laura and Mark have been leaders in SRI for many years and continue
to help us "align our money with our values" whether we are individual investors, institutional
investors or mission-driven foundations. Here's what Mark wants to know from Laura…
MARK: Laura, your journey with SRI has been long and taken many different
forms. Tell us about your journey. What led you to your current position with the Interfaith Center
on Corporate Responsibility?
LAURA: In the April 2007 press release
that announced my arrival at ICCR. The then Chair of ICCR's governing board was quoted as follows,
"Laura has dedicated her career to public service, has a deep passion for faith-based and socially
responsible investing, and is a visionary leader. Her experience and beliefs are an amazing match
for ICCR."
Let me begin by thanking YOU, Mark. You were the Chair of our board at that
time and I greatly appreciated your kind remarks. I was humbled by the generosity of your words,
but what struck me was that I sincerely felt that my entire working life had led me to this role.
Both my professional experiences and my personal journey seemed to be preparing me for this work.
In my professional life I began as an engineer for a specialty chemical company that made
metal treatment chemicals. So I was able to get a close up view of manufacturing and industry in
the United States as a young woman in my twenties working hard to break into a very non-traditional
field. I learned firsthand about many of the justice and sustainability issues that ICCR was
beginning to take for its coalition of concerned shareholders.
One of the plant managers
in my region was married to a woman who had just begun working as a stockbroker. Since she was a
rookie, she was willing to take on REALLY small clients and to spend time with them.
I
developed a real passion for investing and the stock market just as the 1980s were getting started.
Not long after I decided to use my problem- solving background and took a job on Wall Street, the
bull market began to take hold. The Socially Responsible Investment (SRI) field was just getting
rolling as well and SRI made a lot of sense to my first clients, many of whom were university
professors. These folks actually enjoyed the provocative notion that you could discuss money,
politics and religion with your financial advisor and "do well while doing good."
In my
personal life, I was drawn to a really broad appreciation of religion. I was raised in the Catholic
Church and continue to worship as a Catholic and yet I was always drawn to all faith traditions.
Spending time with dear friends who were Muslims and Jews; Evangelicals, Anabaptists and Main Line
Protestants; Hindus, Buddhists and even a fair number of Pagans, I loved learning about other
faiths and enjoyed learning about the traditions and rituals that my friends so kindly shared with
me.
I decided to leave the financial services industry (as well as my office at Seven
World Trade Center) in 2001. By that time most of my clients were faith-based institutional
endowments or wealthy families with a deep commitment to social activism. I was called to the world
of non-profit leadership, serving first in a community development organization and next at one of
the nation's oldest and largest community foundations. When I heard through the SRI "grapevine"
that ICCR was looking for new leadership, I tossed my hat into the ring.
MARK: You've taken the top post as Executive Director of one of the oldest,
most storied and influential SRI organizations in the country - and possibly the world. How do you
reflect on that history? What do you think the past 38 years says about the future for faith-based,
socially concerned investors?
LAURA: It is an extraordinary privilege
to serve as ICCR's Executive Director. The organization's nearly four decades of faithful witness
as investors have been astonishingly successful. ICCR members have earned their place as the
founders of the movement we now call "corporate social responsibility." Although Saul Alinsky was
truly the first activist to use the Corporate Proxy Ballot to address social concerns back in the
mid-sixties, ICCR members, in their role as investors, truly developed the technique. This year
alone ICCR members initiated nearly 800 corporate actions across all areas of environmental, social
and governance issues.
It is clear that the last three years have been a turning point
for faith-based, socially concerned investors. I was chatting with a very savvy business school
professor at a conference the other day and she said, "If I want to know what I'm going to be
reading on the front page of the Wall Street Journal in five years, I just look at what ICCR
members are working on today!"
There are so many examples of industries where ICCR
members have truly exhibited foresight: climate change, the sub-prime debacle, the automotive
industry's troubles, supply chain issues, and so many others. ICCR members have served as an early
warning system by making the connection between unjust or unsustainable corporate practices that
led to inappropriate risk.
As we document these visionary insights and broaden our
efforts to educate and engage a broader audience, I believe the movement will grow and strengthen.
In the current market environment all investors are trying to understand what went wrong and to
discover new approaches to avoid risk and improve performance. Clearly, ICCR members and our social
investment allies have successes that should lead to real expansion of our influence.
MARK: Every job comes with its surprises and unexpected challenges. What has
surprised you about ICCR and its members? What are the challenges they and the broader SRI
community face in adapting to and leveraging the realities we find in the rapidly changing
investment landscape?
LAURA: The depth of ICCR members' commitment to
the organization's mission, building a more just and sustainable world, did not surprise me. Nor
did their hard work surprise me. What did surprise me was the size of ICCR's audience. Within the
corporate social responsibility network, ICCR and its members are well known and acknowledged as
leaders in this work. But when one begins to broaden the circle outside of ICCR's traditional
membership, there is a huge audience waiting to hear our story. An even larger audience is looking
to us to bridge the divide between morality and markets.
I think Walt Kelly was right on
Earth Day in 1970 when his comic strip character, Pogo said "We have met the enemy and he is us."
All investors who hope to integrate social values into corporate and investment practices need to
act as if we expect the traditional investment community to create new valuation models. In some
ways our humility prevents us from tooting our own horn.
With the over $100 billion in
invested assets that ICCR members represent, we need to reconsider our leadership as the world
struggles to redefine how the capital markets function. Even with $2.71 trillion dollars invested
with some social criteria, the SRI community continues to act as an insular boutique. ICCR can take
the lead in reigniting a broader movement to influence all investors. Building social capital into
investment valuation models requires building a broader audience. We must commit to more rigorous
evaluation and documentation of our work. We must pay more attention to assessment. And, perhaps
most challenging, redefining value will require the entire SRI community to display a new openness
to a broader range of ideas to adapt to today's reality.
MARK: Leading
a membership organization is tough work. Leading a membership organization filled with
strong-willed, experienced leaders is even more so. As the Governing Board Chair of ICCR when you
were hired, I believe I suggested you "pack an extra set of batteries" for this assignment. Where
do you go for inspiration and energy to get you through the difficult and demanding parts of this
work?
LAURA: It may be entirely too predictable of an answer but quite
honestly, I pray a lot. I pray constantly. I take a certain amount of comfort in Rabbi Heschel's
famous definition, "A mitzvah is a prayer in action."
One of the great joys in this work,
and frankly one that I would sorely miss if I returned to a more secular working environment, is
being surrounded by people of faith every day. Of course all investors have a kind of "faith." All
investors believe that actions they take today will result in a better, more lucrative future. That
is not the faith I'm talking about. I'm talking about the faith that allows everyone associated
with ICCR to listen for that small, still voice that called Elijah out of the cave. It's the voice
that challenges us to ask, what does it really mean to be a financial fiduciary? How do we
encourage others to move beyond measuring only financial capital and begin considering the wealth
that is created when investments are made with justice and sustainability in mind?
MARK: The concept and language of "environmental, social, and governance" or
"ESG" has gained incredible ground over the past few years, particularly among mainstream
institutional investors. ESG is centered in the belief that certain corporate environmental, social
and governance practices can be shown to have material impact on investment performance. While
opening many new doors, this approach has also raised tension within the traditional SRI community
where many individuals and institutions continue to guide their investments through the application
of values-using processes that are not dependent on financial metrics. What are your thoughts on
the emergence of ESG approaches? Does "faith and values" still have a place in the modern SRI
world?
LAURA: The short answer is "absolutely."
In many ways,
the ESG language complements the work ICCR members have been doing for nearly forty years.
Throughout the 400-year history of this entity we call the "corporation," the idea of social good
has always been core. As our financial models became more sophisticated, somehow investors began to
redefine "materiality" in ways that may have allowed investors to "de-link" faith and values. In
some ways I believe the broader SRI community has responded to materiality challenges with an
attempt to rigorously secularize the conversation, a "separation of church and state" argument. For
example, I believe the SRI community continues to engage in the unproductive "alpha debate." This
is time that could be spent identifying the real factors that contribute to value creation in the
underlying assets. I would like to see this balance shift.
The best investors have always
looked at value through a different lens. When one looks closely at risk, and what led to the
current collapse of the capital markets; the values that undergird the early warning system
demonstrated by faith-based investors is difficult to ignore.
MARK:
Laura, look further down the road. What services and crucial opportunities does the Interfaith
Center on Corporate Responsibility offer the SRI community, institutional investors and a planet
desperately in need of peace, justice and prosperity for all its citizens? How will ICCR continue
to be "inspired by faith, committed to action" in the years ahead?
LAURA:
Our core mission, "to build a just and sustainable world by integrating social values
into corporate and investor actions," will not change. What is evolving is how we will accomplish
our work and with whom. ICCR underwent a yearlong strategic planning process shortly after my
arrival. The process involved over 100 individuals and included an advisory board with members from
outside our current membership.
The plan that will guide our work through 2013 is built
around three principles:- Expanding our global leadership by more rigorous attention
to research and capacity building with the goal of "best in class" institutional practices and
richer knowledge transfer.
- Strengthening our organizational sustainability by
recruiting the next generation of leadership, an explicit focus on outreach to a
broader community and expansion beyond our current funding model.
- Deepening our commitment
to evaluation and assessment to demonstrate our impact, develop tools and tell the story of our
work.
A terrific example of this work is our recently announced podcast, "The Arc of Change:
the ICCR story." It is available at http://podcast.iccr.org
MARK: We've
been through some pretty dark days recently, and SRI organizations have not been immune. With our
nation-and the global community-just beginning to emerge from one of the deepest economic crises in
generations, where do you see sparks of light and hope? What can ICCR and other socially
responsible investors do to encourage the right choices?
LAURA: The
crisis in the capital markets seems custom-made to highlight the good work of ICCR and other
socially responsible investors. This is the time to bring this work to a larger audience of
institutional investors. This is the time to encourage academics to begin asking new questions.
This is the time to ask ourselves "What is risk?" and "What is value?" I believe all financial
fiduciaries are struggling to find new answers. It is time to challenge financial engineers to
discover new models and new metrics. Those of us who "view our investments through the lens of
faith" have been part of this movement for generations and we know where the answers can be found.
Thank you GreenMoney Journal and Mark Regier for allowing me this chance to weigh in on
these important topics.
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