To celebrate its 15th anniversary, the GreenMoney Journal asked leaders in the realms of green business and socially responsible investing to forecast 15 years into the future. How green will our economy be in 2022? GreenMoney’s anniversary issue features responses from Amy Domini of Domini Social Investments, Gary Hirshberg of Stonyfield Farm, futurist Hazel Henderson, and others.

Here, reprinted with permission, is a view from Joan Bavaria, president of Trillium Asset Management Company. (Also read a perspective from Mindy Lubber of Ceres.)

Joan Bavaria

Joan Bavaria.

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What will socially responsible investing (SRI) look like in 15 years? I believe we are in a period of rapid growth with an uncertain outcome. Those of us who are involved in and support socially responsible investing, mission-related investing, corporate social responsibility, and all that involves introducing social and environmental considerations in a market economy must concentrate on what needs to happen to continue making progress, clearly visioning our desired outcomes.

SRI, as it has grown, has broadened from a focused small community centered around causes such as the anti-apartheid movement to an impressive, multi-trillion dollar investment system (PDF) in the U.S. alone, where participants might embrace some or all of a long list of concerns. The Global Reporting Initiative (GRI) started by Ceres and now based in Amsterdam, reports that to date, nearly 1,000 organizations in over 60 countries have declared their use of the GRI Reporting Framework. The Investor Network on Climate Risk (INCR), as described on its website, “is a network of institutional investors and financial institutions dedicated to promoting better understanding of the financial risks and investment opportunities posed by climate change. INCR was launched at the first Institutional Investor Summit on Climate Risk at the United Nations in November, 2003, and now includes more than 50 institutional investors that collectively manage over $3 trillion in assets. Members engage companies and policy makers through educational forums, shareholder resolutions, and other actions to ensure the long-term health of their investments.” The reporting and transparency we have sought has “gone mainstream.”

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The goals and concerns of the small SRI community a few decades ago were generally those of caretaker: protecting human and natural resources from harm, and avoiding exploitation. Reasonable people will differ as to what harm or exploitation means. Over time, we have fostered processes more than an ideology, widening the lenses of capitalism beyond short-term gains for investors and bringing important new players to the table. Despite these processes, however, few of the participants have been willing or able to abandon the traditional intention of “investing” — obtaining maximum possible income or profit — and time horizons for measurement have shrunk.

Surveying socially responsible investing, corporate social responsibility, or mission-related investing today, you find a completely different external environment than the one I found in SRI in the ’70s. Investing has been transformed by technology and by a bevy of ambitious math or finance majors. Investing has also become global, inexorably linking all regions of the world. Given the pace of change in the past 15 years — the mainstreaming, the growth and the new and important participants — what can we expect in the next 15? What are the goals of those who have successfully engaged in a transformational effort, with imposing technologies and cultural pressures threatening to push back their progress?

We are witnessing a growing tension between opposites. First, we have the growing world of investors cultivating sustainable investments that imply long time horizons and “patient capital,” accompanied by more and more companies that embrace corporate social responsibility and believe that environmental, social, and governance (ESG) issues are material to their business. Those promoting sustainable investments are squared off against the high-velocity world of arcane financial products and fast-moving global trading that knows no community and cares not at all for anything except results defined by the compounding of capital. This high-velocity world produces hundreds of ways to invest each year, such as the exchange traded funds that are being widely used as proxies for the general market, or the now old and too plentiful hedge funds or private equity funds that proliferate, occupying space in investment portfolios with very little social or environmental accountability.

Within the SRI community, those who sell services are, rightly, beginning to offer the new products to help clients diversify easily and thus participate in the world economy with minimum risk. This is probably a good thing, as long as the concepts of transparency and sound social analysis are adhered to. But in spite of the proliferation of socially screened or activist products, we are faced with a very stubborn resistance from timeworn arguments.

Many organizations founded for social or environmental purposes still play the compounding math game with little social or environmental input because their trustees or board members fear an undefined and almost never meted punishment for abrogating their fiduciary responsibilities. “Universal Owner” is a relatively new hypothesis which “states that a portfolio investor benefiting from a company externalizing costs might experience a reduction in overall returns due to these externalities adversely affecting other investments in the portfolio, and hence market return,” write Raj Thamotheram and Helen Wildsmith in their paper “Putting the Universal Owner Hypothesis into Action.” This is a correct hypothesis, in my view. But in 2006, in the face of extraordinary profits made in the stock of some petroleum companies, many trustees and board members simply reverted to short-term comparisons. The fact that many socially responsible investors did not invest in the stocks that benefited the most, increasing close to 40 percent in that one year, prompted one trustee to say, “So now we know what social investing can do for us!” This person is on the board of an environmental activist nonprofit organization and could have been sanctioning investments in the same companies that they fight daily in Washington, D.C., and on the ground.

If I were to predict tomorrow based on today, I would say “more of the same,” but I hope for more maturity and sustainability. Straight-line growth would involve more products, more vendors, more activities, more corporate reports, and more tension. The sheer pace of change and recalcitrance of key actors could throw all we’ve accomplished in reverse. CERES, GRI, and INCR must beg for money every day — they are vastly underfunded for the scope of their challenges. In 15 years, we could be twice as big and successful, an imbedded and necessary part of a more sustainable economic system, or hardly exist at all as the world races backward toward a voracious capitalist system that tramples nature and the defenseless.

But let’s envision the first option for 15 years from now — bigger and successful, more mature and sustainable:

  1. We protect our nucleus — the long-term idealist vision around SRI — with people and organizations changing over time. The nucleus is formally and continually assessing the “growth” of SRI and its mainstreaming outer edges to ensure that projects such as the “1% or More in Community Campaign” of the Social Investment Forum are invented and supported. We are mainstreamed, but we are imbedding core ideas into the system as more people and organizations become involved.
  2. We are supporting transparency. What we really strive for is a democratic market system. To function well, with environmental, social, and governance issues managed in the interest of all stakeholders, information is critical. Around the world, many companies have made the commitment to transparency. In 15 years, we will be supporting them and gleaning critical information from the reports. This reporting should be accepted and expected by all stakeholders of business.
  3. Socially responsible investing offers a wide array of legitimate, sustainable financial products to investors, and they are socially analyzed, screened, active, and high-performing.
  4. Investors have learned to look beyond the short-term, narrow financial data to judge performance — they take into consideration environmental and social impacts.
  5. Transparency includes the availability of comprehensive data on political contributions, business support of political organizations, and lobbying dollars. Through transparency we have again created the distance between government and commerce that is necessary in a democracy and that was envisioned in the U.S. Constitution.
  6. Many nation-states or other political regions demand ESG reporting from public and private companies. Costs that have been “externalized” by many industries are clearly quantified, and through taxes or lower stock prices (as investors look to the long-term real return of their money) those costs are borne by the business entities.
  7. The definition of fiduciary has been expanded to include issues other than financial performance and accounting. Trustees and boards regularly see reports on social or environmental performance results that they deem as important as financial reports.

We’re at an important turning point in SRI as we have become visible, potent, and a threat. Growth for the sake of growth could lead us to an enlarged but meaningless future. It’s vitally important that we steer that growth, promoting core system changes that will ensure that socially responsible investing becomes an integral and permanent part of the market system.

This article was originally published on as part of its special 15th anniversary “Visionaries” issue. For more information, go to