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Michael Swan

Socially responsible investing goes mainstream

January 26, 2011

In the 20th century big business was strictly business. But in the 21st century companies can’t stay in business if they’re ignoring the environment, hushing talk of human and labour rights or not returning calls from shareholders who want to know what the board is doing and why. Socially responsible investors are no longer on the fringe of the investment world. Where 10 years ago talk of ethical investing drew smirks and rolling eyeballs, today it’s a top-line concern of boards, CEOs and CFOs. “The huge difference (compared to 10 years ago) is that we’ve seen acceptance in the mainstream,” said Michael Jantzi, CEO and founder of Jantzi Sustainalytics. On the environment, social issues and governance, corporations now see non-financial issues, once considered “externalities,” central to running a successful business in the long term, said Jantzi, who established Canada’s socially responsible investing (SRI) stock index — the Jantzi Social Index — in 2000. “We’re only going to see an increased level of interest in these issues,” he said. Particularly on the environment, corporations now regard the risks as anything but external, said Social Investment Organization executive director Eugene Ellmen. “The BP disaster really was a wake-up call. It was a wake-up call for the mainstream industry,” said Ellmen. SRI investors knew BP was running risks in the Gulf of Mexico long before it happened and avoided the stock. Investors who ignored the environmental risks paid the price. The investment industry in Canada is not the world leader in sustainable, socially responsible investment. With 13 separate jurisdictions and regulators at the federal level opting for voluntary codes of conduct and optional enforcement, the global investment industry is setting the tone. Two international covenants have become central pillars in the world of ESG (environment, social and governance) investing. The Carbon Disclosure Project includes 534 institutional investors around the world representing $64 trillion in assets. The corporations and investment funds that subscribe to the London-based CDP are committed to researching and publishing the amount of carbon their business operations release into the atmosphere. Four-hundred-and-eighty-five investment managers, 220 asset owners and 168 professional service partners with $22 trillion in assets under management have signed the United Nations-backed Principles for Responsible Investment. The stock market meltdown of fall 2008 didn’t drive the big investors away from ESG. The largest number of UNPRI signatories came on board after the crisis. In Canada, the big public pension funds are leading the way. The Caisse de dépot et placement du Quebec, OPSEU Pension Trust, British Columbia Municipal Pension Plan and Canada Pension Plan Investment Board are all signatories to the UNPRI. “On the Canadian scene specifically, I think we’ve got some great leadership here in the pension community,” said Jantzi. When the big pension funds call up asking about future environmental liabilities, Canada’s publicly traded companies respond. “Institutional investors are continuing to press for more disclosure on environmental, social and governance issues,” said Jantzi. “And the companies are having to respond.” Canadian markets will be led more by global trends than local regulation, according to Jantzi. “On a global scale, Canadian financial markets just don’t have a huge amount of heft,” he said. Canadian regulators, particularly the Ontario Securities Commission, are beginning to set conditions that will make SRI standard practice. The OSC may soon require publicly traded companies to “say-on-pay.” The SRI community has long demanded that boards reveal how much CEOs and other senior management make — and disclose what incentives are built into their compensation. Even without enforceable say-on-pay rules, ESG Services, working for Ethical Funds and its parent NEI Investments, has been researching how oil sands company CEOs are paid, and whether their pay is tied to reductions in environmental liabilities. They’ve found that the oil sands bosses get paid even if nobody knows how much it will cost shareholders to clean up vast tailing ponds or compensate native communities for downstream health outcomes. For private investors — people who typically buy mutual funds at tax time — the chance to influence corporate Canada on the environment, social issues and governance has expanded exponentially in a decade. Where once persistence was required to persuade a financial advisor to sell an SRI mutual fund, now all the big banks offer socially responsible funds. There’s also been a series of buy-outs of smaller SRI mutual fund companies that have made the funds more easily available. Where Ethical Funds were once only available at some credit unions they’re now sold through Desjardins Bank and the independent brokers that deal with Northwest and Ethical Investments (NEI). Acuity mutual funds are now similarly available through the much larger distribution network of AGF Management Limited. “It puts the socially responsible mutual fund companies on more equal footing,” said Jantzi. “A lot of those advantages haven’t fully kicked in yet.” While the funds are more available, it doesn’t mean that they’ve been impressing investors with great results. “The industry has been somewhat disappointed,” said Ellmen. The JSI has struggled to keep pace with conventional stock indices since the 2008 meltdown. “I don’t put too much stock in short-term results,” said Jantzi. “The financial sector continues to struggle and we’re heavily weighted in the financial stocks.” Holding considerable bank and insurance stocks means holding less in oil or gold mining — the resource sectors that have kept Canadian stock exchanges afloat the past two years. “It’s a social index. It’s weighted differently, as you would expect. Over a shorter period of time you will see things struggle,” said Jantzi. Even with disappointing recent results, Canadians continue to be interested in ESG factors in their investments. Social Investment Organization polling suggest 70 per cent of Canadian investors want more information about socially responsible investing, said Ellmen. With between two and three per cent of Canada’s pool of mutual fund money invested in SRI funds, there’s “huge room for growth,” he said.


Haitians must look to themselves to rebuild their nation

January 7, 2011

Haiti construction [images/stories/features/freature11/haiticonstruction.jpg] As Haitians go about constructing their future they have some surprising resources to draw upon. These include the Church, the international community and the vast network of humanitarian NGOs around the world. But one of most overlooked accounts is the community of extraordinarily talented expatriate Haitians, mainly in Canada, France and the United States, who are deeply attached to the land of their birth. The Catholic Register spoke to Haitian Studies Association president Guerda Nicolas about Haiti's present and future reality. Nicolas has been deeply involved in rebuilding efforts in Petit Goave near Port-au-Prince and has been called upon to advise the Haitian government. A professor of psychology at the University of Miami, she has both an insider's perspective and the ability to see Haiti through the world's eyes. Catholic Register: What is your sense about the present state of the recovery effort? Guerda Nicolas: I usually try to make it back to Haiti five to six times a year, but I've been going monthly since the quake. I don't think recovery is taking place yet. I participate in a lot of planning. I'm on the committee for higher education. I'm on a committee with the assistant minister of health. There's a lot of talk and discussion and strategies, but I haven't really seen a lot of movement. I was really pleased when I was in Haiti recently that people have stopped waiting, especially outside of Port-au-Prince. I think the situation is quite different outside of Port-au-Prince. People have already started to take action into their own hands and say, "We really need to rebuild our home and rebuild our area. We can't afford to wait for aid." I think that's a better strategy. CR: Was the earthquake an opportunity to start again for a nation that has been badly governed for so much of its history? GN: Haiti has always been a very vulnerable place. There are lots of people who have in interest in Haiti and not necessarily for Haiti. People are very cautious about this idea of rebuilding and refounding Haiti. People in Haiti — including myself who was born, grew up and did most of my education in Haiti — we are just concerned about the plans. CR: Are you hopeful? GN: I am very hopeful that the Haitian people are very, very strong and very, very resilient. People get a very narrow perspective of who Haitians are and what the Haitian people are about. Most people get a glimpse of what Haiti is about from a Port-au-Prince perspective, and for me that's like getting a picture of what Canada is like from a Toronto perspective or getting a glimpse of the U.S. from New York. It doesn't really capture the essence of what I think Haiti is about. When I'm outside of Port-au-Prince I'm very hopeful. When I'm in Port-au-Prince I can't help but be depressed. CR: How does the Haitian religious sense determine psychological treatment of people traumatized by the last year? GN: The resiliency aspect of Haitians is because they are faith-based people. We're talking about people who have a really strong faith that doesn't get rattled by disasters, even what we just saw. The majority of people in Haiti believe in God, in God's purpose, and in their purpose in this world. And they use that. That is really what people use to deal with the uncertainty of life. It helps them to cope with whatever's coming their way. Mostly people are just praying. They're praying and going to church, not just on Sunday but all the time. That's their number one coping mechanism. It's a really strong belief that God is with them, and is always with them, and God is good and is good all the time. When things happen that you don't understand you should have even stronger faith. CR: Haitians also believe in the devil, and many people after the earthquake experienced nightmares featuring the devil. Can you explain the devil in the Haitian mindset? GN: That's a part of our Catholic upbringing. I remember growing up and going to Catholic school, and there were really only two types of doctrine. One was God and the goodness of God and the other was the devil. All bad things are not a result of God. It's got to be a result of the other. There's a sense from people that this (earthquake, cholera, hurricanes) is not God's doing. It can't be because God is just too good. Therefore it is the work of the devil. It is the work of evilness. This (earthquake) is not an opportunity to be unfaithful to our God because that's not what our God would do. That is the message that is not forgotten. When I see the parents talking to the kids and the kids are wondering, especially the adolescents are wondering, "why are you going to church and why are you praying? Why would God do such a thing? Why would God allow such a thing to happen to us?" The answer is really simple. This is not the work of God. This is the work of the other. And we're going to have to continue to praise Him for His glory and what He did, which He did for us. Because that's the only way we will defeat the devil. This is not the time for us to become non-believers. That's the message they're giving to their kids. CR: Does Haiti have the resources to deal with a traumatized population? GN: Haiti has more of the resources that it needs than people have assumed. I think people assume that there are no psychiatric nurses in Haiti, that there are no social workers, that there are no psychologists and that there are no psychiatrists in Haiti. And that's false. CR: What role do you see for Haitian expatriates? Can Haiti use you, use that community around the world, to build a new future? GN: Actually, I think Haiti is dependent on that. My message this year to the Haitian Studies Association was very clear. We have Haitian scholars in every discipline that Haiti is in need of. We have medical doctors, we have psychiatrists, psycghologists, we have educators, we have nurses, we have engineers. We have all the groups... Haiti is in need of us now. We're in a position that is very different from somebody who is not familiar with the culture, who is not familiar with the soil of Haiti. It's very clear to me that Haiti's future is not dependent on foreign aid and foreigners coming into Haiti. That has been the history of Haiti in the past. I really do believe that this is the time that we need to come back home. It is time for Haitians to come back home. Not on a permanent level. I"m not asking everybody to go as often as I do, or to go back and live in Haiti. But those talented minds are needed in Haiti. People need to see people who speak for them who are highly educated. That's the kind of role models this next generation needs to see. CR: Do we foreigners have a part to play? GN: Absolutely. Working with some of my colleagues and some of the work we're doing there's an opportunituy to enrich both ways. My colleagues who are white get a chance to be enriched and be exposed to a whole other culture and a way of life that is very different. I am in need of that collaboration with my colleagues. I can only speak from my experience, working with some of my white colleagues, how crucial it is to have their expertise, their level of experience and their outside perspectives in what we are doing. I'm so in it, that once in a while it's good to have somebody say, "Hey Guerda have you thought about this?" I don't have all the answers. And it's really really good to be part of a team. For me that's the answer, to be part of a teamwork approach. CR: Is the Church a help or hindrance in Haiti's recovery? GN: If you really want to get Haitians moving there are only two things you have to say to them. One is the Church. It's really having an opportunity to connect with their priests and pastors, to hear from their priests and pastors. That has a lot of meaning to them. The second is to talk to them about how to get an education for their kids. If we don't have a Church component in Haiti, really, honesty there's only half a Haiti. Haiti is so dependent, so attached, and the people of Haiti are so ingrained in their Church, in the Church message and in their spiritual self that it is absolutely crucial that that continues. But I think an examination of how the message is delivered is really important. The question is not the importance of the Church, but really what kind of message is the Church delivering, and how is that message consistent on a day-to-day, week-to-week and monthly basis? - RAISING UP HAITI - A CATHOLIC REGISTER SPECIAL REPORT HAITI'S CHURCHES NEED HEALING [SLIDESHOW] WHAT NOW IN HAITI? POST-TRAUMATIC STRESS PROVES DIFFICULT CATHOLIC AID ORGANIZATIONS FLY UNDER THE RADAR CANADIAN ENGINEER TO OVERSEE HAITI’S CHURCH REBUILD HAITI MUST TAKE THIS OPPORTUNITY TO CHANGE CRISIS MAKES D&P RETHINK HOW IT OPERATES BOLD EDUCATION PLAN HELD UP BY A LACK OF FUNDS CHURCH HOLDS COMMUNITY TOGETHER D&P-FUNDED PROGRAM PROVIDES PRO-LIFE SOLUTION TO HAITI'S SEXUAL VIOLENCE HAITIANS MUST LOOK TO THEMSELVES TO REBUILD THEIR NATION


D&P-funded program provides pro-life solution to Haiti's sexual violence

January 6, 2011

Haiti washing [images/stories/features/freature11/haitiwashing.jpg] In the tent camps around Port-au-Prince, in the collapsed and desperate slums of Cite Soleil, amid the violence of a chaotic city policed by United Nations troops from around the world there’s a pro-life story. Kay Famn (Creole for the House of Women) doesn’t call itself a pro-life organization. The Development and Peace partner proudly claims the title feminist. What Kay Famn does, however, lifts up women and the value of life in the face of violence and the most corrosive poverty in the Western Hemisphere. Before the earthquake Kay Famn ran one of the only women’s shelters in Haiti — a country where until 2005 rape was considered a crime against honour rather than a crime against a person. Now with more than one million people crammed into tent camps where there are no locked doors and the shadows at night hide all kinds of crime, Kay Famn is seeing a steady stream of girls, many between 13 and 15, come to them pregnant. “They arrive pregnant and give birth here,” Kay Famn co-ordinator Yolette Jeanty told The Catholic Register. Somebody has to prepare the girls for motherhood. “They’re kids we are preparing to give birth,” said Jeanty. “They don’t have families. They stay with other kids.” The program is called Revive. In addition to dealing with the trauma of the girls’ situation — whether they’ve been raped, seduced by an older man or surprised to discover they are pregnant — Kay Famn tries to keep the girls in school or at least provide basic literacy and job training. If not for Kay Famn, no end of illegal and dangerous abortions are performed in Haiti. Given the state of health care, the girls chances of surviving child birth without Kay Famn are low. Even before the earthquake, the maternal mortality ratio for Haiti was 670 for every 100,000 live births, according to Unicef. The problem is bigger than Kay Famn can deal with. They’ve got room for about a dozen girls at a time. They can offer financial support for 40 girls. Out there in the camps there’s an epidemic of sexual violence and a kind of brutal economy in which sex is traded for protection, food and shelter. All of that means there’s good reason to help Kay Famn with financing and strategy, said Development and Peace executive director Michael Casey. “You look at that tragedy, that kind of thing happening to very young girls, the violence being perpetrated against women in the camps — the stuff that Kay Famn is working with,” he said. “Those are very, very important stories.” “There’s a lot of sexual violence against little girls and adolescents,” said Jeanty. “Men are using violence to bring girls to bed. Or trading rice for sex.” Kay Famn does not advocate for abortion access because that won’t solve Haiti’s problem with sexual violence and predation. They do what they can for the girls who come to them. “The situation in the camps has exacerbated the problem,” said Jeanty. - RAISING UP HAITI - A CATHOLIC REGISTER SPECIAL REPORT HAITI'S CHURCHES NEED HEALING [SLIDESHOW] WHAT NOW IN HAITI? POST-TRAUMATIC STRESS PROVES DIFFICULT CATHOLIC AID ORGANIZATIONS FLY UNDER THE RADAR CANADIAN ENGINEER TO OVERSEE HAITI’S CHURCH REBUILD HAITI MUST TAKE THIS OPPORTUNITY TO CHANGE CRISIS MAKES D&P RETHINK HOW IT OPERATES BOLD EDUCATION PLAN HELD UP BY A LACK OF FUNDS CHURCH HOLDS COMMUNITY TOGETHER D&P-FUNDED PROGRAM PROVIDES PRO-LIFE SOLUTION TO HAITI'S SEXUAL VIOLENCE HAITIANS MUST LOOK TO THEMSELVES TO REBUILD THEIR NATION


Church holds community together

January 6, 2011

Odessi Petitfoin [images/stories/features/freature11/odessipetitfoin.jpg] Madame Odessi Petit Foin knows exactly what she’s missing since the church in Duvale collapsed, along with her house and most of the other houses in the farming community. Duvale always did need lots of things. It was never rich. It needed a new road before the earthquake and now it needs it more. It has needed a new school for a long time and thanks to the earthquake it got one — built with aid money on the foundations of the collapsed church. And it needs houses for the families still living in tents by their tiny plots of tomatoes, cucumbers and peas. In Petit Foin’s opinion, Duvale also needs its church. “It preaches morality and conversion,” she said. She also makes the point that it’s through the church that Duvale gets access to the international aid money which will finance a new Caritas Port-au-Prince agricultural improvement project. But that’s not the most important reason that Duvale needs its church. “The church in Duvale plays a very big role that holds together friends and family,” she said. Petit Foin is not an economist, a politician, a theologian or philosopher. But as she stands in the old church hall, which has become the church in Duvale, she’s hit upon something quite important. There’s more to infrastructure than the efficient delivery of goods to market on safe, smooth and broad roads. A community requires infrastructure so it can hold together, so it can know itself and meet the world. Duvale needs its church so that it can be a community which people recognize when they see the church. The people of Duvale themselves need to recognize that they are a community of families when they meet for Sunday morning Mass. There is such a thing as spiritual infrastructure. In fact, if Duvale had a great road connecting it with Port-au-Prince but its people had lost their way and no longer knew themselves, no longer cared for each other, no longer lived in and for their families — well, that would be a road to nowhere. - RAISING UP HAITI - A CATHOLIC REGISTER SPECIAL REPORT HAITI'S CHURCHES NEED HEALING [SLIDESHOW] WHAT NOW IN HAITI? POST-TRAUMATIC STRESS PROVES DIFFICULT CATHOLIC AID ORGANIZATIONS FLY UNDER THE RADAR CANADIAN ENGINEER TO OVERSEE HAITI’S CHURCH REBUILD HAITI MUST TAKE THIS OPPORTUNITY TO CHANGE CRISIS MAKES D&P RETHINK HOW IT OPERATES BOLD EDUCATION PLAN HELD UP BY A LACK OF FUNDS CHURCH HOLDS COMMUNITY TOGETHER D&P-FUNDED PROGRAM PROVIDES PRO-LIFE SOLUTION TO HAITI'S SEXUAL VIOLENCE HAITIANS MUST LOOK TO THEMSELVES TO REBUILD THEIR NATION