“If you do not change direction, you may end up where you are heading” - Lao Tzu
To begin writing this blog post, I asked the internet to provide me with quotations about needing to trust one’s own path, and paradoxically, I also searched for those about seeking new approaches. The quotation above, in its own poetic way, captures the innovation, self-confidence and intentional navigation shared by each of our speakers at the October 15, 2021 Confluence “coffee klatch” etitled, “Sustainability and Active Ownership: What’s Working to Solve the Climate Crisis.”
This casual, conversational session focused less on the technical components of climate change solutions and more on the paths being travelled in order to bring those solutions forward. In the session, we talked about our roles as individuals and representatives of organizations, we brainstormed new solutions, encouraged one another, and celebrated the possibilities that active ownership within an investment portfolio holds.
This session was catalyzed by the incredible changes in corporate practices that investors were able to bring forward last year (2021). As an example, looking only at investors’ actions to address climate: investors found success in changing Exxon’s board members, in having Blackrock respond to climate Net Zero Goals, and in mounting pressure on big banks to address climate change.
Despite these changes, however, a number of investors remain skeptical about the value of active ownership. This “coffee klatch” was intended to address some of the hesitancy, some of the intertia that otherwise-engaged investors feel in addressing climate and other social and environmental issues as shareholder advocates.
David Monsma, Program Director, Environment, Educational Foundation of America (EFA), spoke first. He detailed EFA’s shareholder and advocacy work, providing a speedy case study on what an engaged asset owner can do. He emphasized the ways in which EFA’s shareholder involvement supported the main work of the Foundation. He also spoke to the tools and processes that EFA followed, regardless of topic area, in applying a shareholder lens to their foundational goals.
Jill Soffer, Founder, Our Part Foundation and Banking for Climate next encouraged all participants to bring forward their own voices on climate topics. Jill’s work focuses on encouraging individuals and organizations with strong client relationships with banks to step forward to raise their climate concerns. She spoke to not ony the joys of the learning curve, but also the need to embrace and accept that it can exist in concert with effective advocacy. That is: Someone new to holding conversations with companies can learn about the process while still acting as an effective messenger, truth teller, advocate, and question-asker.
Loren Blackford, Director and Investment Committee Chair, Sierra Club Foundation, followed this same theme, speaking to the Sierra Club Foundation’s experience in their active ownership and shareholder advocacy work. She was clear with the audience that, for the Sierra Club Foundation, the challenges it has overcome in order to pursue shareholder engagement had been worth it to the organization, given the outcomes catalyzed. She did not speak in depth to this organization’s relationship with BlackRock, but she might have. Many climate activists owe a debt of gratitude for the pressure that has been well applied by the Sierra Club Foundation on the world’s largest asset owner.
Finally, I, Meredith Benton, Principal and Founder, Whistle Stop Capital, took advantage of my role as moderator, asking the panelists to respond to the initial findings of a Whistle Stop Capital- led research study, commissioned by Confluence Philanthropy, which looks at what concerns change-oriented foundations have with shareholder advocacy. The questions we touched on included: Can asset owners really “fake it till we make it” when it’s a discussion on nuanced bank climate strategies? If a foundation is running lean, where can they find the additional capacity for shareholder engagement? And, if everyone and their sister is promising to be a long-time leader, how can investors determine who the appropriate partners should be?
What was most striking about these panelists was neither their accomplishments nor the amusing and encouraging stories they had to tell. Rather it was that they had chosen their paths forward, deciding with intention how they would utilize their power as asset owners to address climate change. They knew exactly where they intended to be.
- Meredith Benton, Principal/Founder, Whistle Stop Capital
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