Capitalism with a
Conscience
By Cynthia
G. Wagner
Tipping point or Gold Rush?
Socially responsible investing takes off.
Investors have been putting money where their
values are for at least the past two decades, but now socially
responsible investing (SRI) has gained powerful new momentum, according
to independent futurist Hazel Henderson in her most recent book,
Ethical Markets.
"Economists, Wall Street analysts, and financial
media have discounted the trend toward sustainable economies and
socially responsible investing for two decades," she writes. "Now, a
tipping point has been reached in the growth of SRI and its robust rates
of return. In the 1980s, SRI assets totaled about $40 billion, mostly
owned by mainstream religious groups and charitable foundations whose
values always went beyond the bottom line. Today, the Social Investment
Forum reports that values-based investors account for more than 11% of
all investments under professional management."
Driving much of the recent push in SRI are venture
capitalists, whose forays into supporting "clean" and "green" companies
surged in 2006, reports Henderson.
"Venture capital has always played a unique role
in the U.S. economy," she says, "spawning our rapid technological
innovation during the industrial age. Venture capital fueled the dot-com
companies of the 1990s--and investors lost trillions of dollars when
this bubble burst in 2000. After languishing and licking their wounds,
venture investors have now discovered the next big thing--technologies
needed to create more sustainable societies."
Nicholas Parker, is founder and chairman of
Cleantech Capital Group, which sponsors regular Venture Forums
attracting hundreds of capitalists.
There is fear about SRI becoming another dot-com
bubble: "The herd behavior of investors has initiated a rush, which may
be too much, according to Nick Parker, who doesn't want to see a new
bubble occur in cleantech," writes Henderson.
This "next-big-thing" mentality is one reason even
venture capitalists like Parker are reluctant to associate their
interest in green companies and technologies with SRI. The drive to
invest in "cleantech," Parker told The New York Times, "is not
the venture equivalent of socially responsible investing. This isn't
about creating a few shekels for a community group." It is about making
money, plain and simple.
The power of money to shape the future is clear to
growing numbers of investors. Henderson quotes Wayne Silby, founder of
the Calvert Group and co-founder of the Social Venture Network: "When we
invest our money, it's like voting for the kind of world we want to
create. It's expressing our values."
Source: Ethical Markets: Growing
the Green Economy by Hazel Henderson, with Simran Sethi. Chelsea
Green Publishing, 2007. Approx. 245 pages. Paperback.
To order the print edition of the
July-August
2007 issue of THE FUTURIST ($4.95 plus $3 postage and handling) or to become a
member of the World
Future Society ($49 per year).
COPYRIGHT © 2007 WORLD FUTURE SOCIETY, 7910 Woodmont Avenue, Suite 450, Bethesda,
Maryland 20814. Tel. 301-656-8274. E-mail info@wfs.org. Web site
http://www.wfs.org. All rights
reserved.
