Image via WikipediaThere are grounds for optimism that a ‘positive impact’ approach to investing can speed up society’s progress to a fairer and more environmentally sustainable economic system, and churches can help lead the way. This was the encouraging message from four expert speakers at a well-attended public panel debate organised by the Ecumenical Council for Corporate Responsibility (ECCR) at Methodist Church House in London yesterday.
Entitled ‘Positive Impact Investment: Too Good to Be True?’, the debate was chaired by Rt Rev Lord Harries (former Bishop of Oxford). It set out to explore the challenges and opportunities facing churches and others who seek to align their investments with their mission and values.
Panellists James Bevan of CCLA Investment Management, Ryan Brightwell of Co-operative Financial Services, Clare Brook of WHEB Asset Management, and Adam Ognall of UK Sustainable Investment and Finance addressed the question whether innovative approaches to capital allocation are the shape of investment to come or likely to remain a niche sector.
In the wake of the financial crisis, the speakers agreed that there is more need than ever for churches and responsible investors to appreciate the risks we run if we do not take into account the social and environmental consequences of investment decisions. BP’s loss of value following the Gulf of Mexico oil disaster was a classic case in point. Companies and fund managers who ignore social issues such as child labour equally run major risks.
The meeting heard that while ethical and socially responsible investing has increased fourfold in the last decade, it still represents only two per cent of the investment market. But just as the churches have led the way with Fair Trade, they can also play a key catalysing role by investing sustainably.
Panellists described a growing range of funds that blend financial, social and environmental returns more effectively than mainstream equity investments. At the same time, money managers needed to be held more to account, and political leadership and policy change were needed to encourage longer-term horizons.
As James Bevan said: "The strength of the capitalist system to mobilise activity, combined with the recognised need for the system to be tamed, creates the huge potential for positive impact investment."
The Ecumenical Council for Corporate Responsibility (ECCR) is a church-based investor coalition and membership organisation working for economic justice, human rights and environmental sustainability.