From my last blog post, I got a great deal of feedback and some excellent comments that I wanted to share with you. Thank you to my friends, critics and cynics for sharing. Enjoy.
You are a lovable cynic. Which is odd for someone in a business fundamentally defined by idealism and optimism.
The cynic believes people are motivated purely by self-interest. [Synonyms: Sceptic, doubter, doubting Thomas, scoffer.]
Impact investors are motivated by outer-directedness: acting for honorable or unselfish reasons to achieve civic, social or environmental good. [Antonyms: idealist, optimist.] The cynic doubts their sincerity.
Each of us embodies tendencies of self-interest and outer-directedness.
Perhaps the root of your cynicism is recognizing the overly simplistic black-and-white cynical/idealist framework is inherently inaccurate.
Balance matters in life and balance is elusive. All of us balance tendencies in our behavior and decisions. Impact investors are no different from the rest of us. Their motivations are honorable, but investors are people, and people aren’t at their best when they engage self-destructive behavior.
There is nothing wrong with self-interest. People can help others better after helping themselves. That’s why the airlines tell us before every flight: Put on your oxygen mask before helping others with theirs.
Today, the aspiration of a 100% impact portfolio may be noble but unrealistic given the complex realities of the carbon economy.
Balancing aspiration and realism is an ongoing conversation. Your work is a catalyst to that conversation.
Nice post. The return on rhetoric within the impact space is low… And the traditional finance community continues to misprice risk by 1) valuing liquidity events over actual progress–be it specific impact outcomes or even core operating revenues and 2) not looking at ESG and other sustainability risks meaningfully (or dismissing them…only to get smacked economically on the back end).
But there is a way—risk can be opportunity seeking…take a look at a couple pieces that we have put out on the concept–for corporate operators/enterprises as well as for fiduciaries and investors:
Risk and Opportunity Inc.: Managing Risks As Profitable Opportunities
Let’s connect soon!
‘Robert, you are a pain in the ass. I am a pain in the ass. Many of us are a pain in the ass. The vast majority of the financial folks aren’t yet in any way convinced that we are doing a necessary job. Just as we both experienced in recent gatherings even those that create products around renewables, are ego-centric, technology-centric, dollar-centric, financial system-centric. It all has to remain in the same system boundaries, because it’s their system, it’s all they learned, and they don’t see that leaders necessarily create masses of brave followers.
I have spend 5 years now in understanding the human brain, studied Beck/Graves/Wilber’s spiral dynamics, looked at Scharmer’s Theory U, understand Mindfulness…it all boils down to one single thing…the need for systemic change needs to be understood and grab these people by their inner self…one by one…and it’s painful…normally. This is why I co-founded the ThriveAbility Foundation, worked with my colleagues Robin Wood, Bill Baue and Paul van Schaik on the synthesis of sustainability (the original concept), design, innovation and consciousness. We developed the ThriveAbility Journey, the ThriveAbility Roadmap, assessments that help overcome the sustainability context gap, the organizational transformation gap and, finally, the socio-cultural leadership gap. We have calculated True Future Value as an ‚irrestistable‘ way to analyze companies and are about to develop a ThriveAbility Index, based on the three gaps, in order to bring the financial markets back home.
GISR is in the meanwhile covering the continuous improvement needs in the rating, ranking and indexing world, and Reporting 3.0 develops recommendations for standard setters, the accounting profession, data providers and new business model representatives on how to boost their own improvement to make the micro-macro link happen. That is my world, and it needs a systemic approach. There will never ever be sustainability without economic systems boundary change. And as long as that doesn’t change and people are forced to stay within the existing boundaries, especially in the financial market sector, you and I will remain a pain in the ass.’
Thanks for addressing this, and I hope you appreciate my honest response!
Please join all the sustainable finance thought leaders, cynics, critics and great souls who are gathering in Stockholm on Sept. 20-21 at Nasdaq
TBLI VIP Dinners Stockholm and Amsterdam
As part of our ongoing capacity building work, we recently held our TBLI VIP dinners in Stockholm and Amsterdam. I want to thank all the thought leaders, asset owners and managers who joined us to share experiences and knowledge around ESG & Impact Investing. In particular, I want to thank Janus Capital for hosting the dinners. It was a wonderful and inspiring evening.
I look forward to the next dinners and breaking bread with another group of inspiring people.