Sustainability, Finance and Women

“Giving women in the workplace a voice in the sustainability debate”

May 2003 Volume I Number 1

I. Network Panel:
April 29 at Swiss Re

II. Network Panelists
Eight-Step Program
Adrienne Atwell

Soul and Money
Joyce Haboucha

Giving Women Credit
Donna Katzin

III. Network’s Next Event

IV. Network Concept

I. Network Panel:
April 29 at Swiss Re
Thanks…to all participants-over 50 of you–at the April 29 luncheon panel sponsored by Swiss Re in New York City. And to all who missed it, we hope you’ll be able to join us at our next event in June (see section III, below).

Called “Sustainability, Finance and Women,” the panel featured three speakers: Adrienne Atwell, sustainability manager of Swiss Re; Joyce Haboucha, portfolio manager in charge of socially responsive investing at Rockefeller & Co.; and Donna Katzin, executive director of Shared Interest, a non-profit group focused on community investing and micro-finance.

Christine Seketa, Swiss Re senior communications manager, introduced the panel, evoking the inspiring work of eminent environmental scientist Jane Goodall. Ann Goodman, Network co-founder and president of Telesis Consulting, moderated the discussion, substituting for Linda Descano, COO of CitiGroup subsidiary Women & Co. and a Network board member. The event was dedicated to the late Robert Pestel of the European Commission, whose warmth, wit, wisdom and tireless support of the Network through thick and thin make him its honorary godfather.

Representing three distinct perspectives on finance-insurance, investing and micro-lending–panelists examined how a company’s socially responsible activities-or lack thereof–affect its business. In particular, panelists discussed how corporate sustainability initiatives influence insurance costs and share value. The panel also looked at an important way that companies can put financial resources to work in a pro-active, socially responsible manner through micro-finance programs in communities where they operate.

II. Network Panelists
Each panelist highlighted one of three key roles women play in finance:

  • by sensitizing companies to the financial consequences of their socially responsible activities, frequently as risk managers concerned with insurance costs;
  • by recognizing their rights as shareholders to influence corporate actions, not just by screening their investments but also through proxy voting
  • and, as micro-loan recipients, by establishing independent businesses, investing in their families and communities and by earning high credit ratings through consistent loan repayment.

Eight-Step Program
Kicking off the panel, Swiss Re’s Adrienne Atwell examined how companies can cut their insurance costs through sustainability efforts, such as waste-minimization and energy-savings programs. The biggest obstacle, she noted, is that most insurers “don’t know what sustainability means,” because up to this point they haven’t seen its direct effect on their loss ratios. That puts the onus on companies not just to learn to “speak the language of insurers,” but also to do the hard mental acrobatics of “equating risk reduction through sustainability with insurance products and services.”

In theory, “insurance companies should reward companies that do positive things” by cutting their premiums, Atwell said. “But in reality, insurers reward companies only if their own risks are reduced.” Again, that means the onus falls on companies to do the hard work to realize cost savings. But Atwell recommended eight steps to help companies streamline the process of cutting insurance costs:

  1. Work with a good insurance broker
  2. Know your company’s insurance program, including what it covers, and whether it provides for environmental liabilities
  3. Understand how your company is rated by insurers
  4. Negotiate with the broker to earn a better rating
  5. Invite the insurer’s site inspectors into the discussion (hint: simple cooperation can earn you a reduction of up to 10 percent)
  6. Speak the language of insurers (hint: they’re largely engineers concerned with loss)
  7. Have confidence in the organization
  8. Look at the total cost of risk, not just component parts

Soul and Money
Socially responsible investing (SRI) “isn’t about your soul,” insisted Joyce Haboucha, Rockefeller & Co.’s SRI portfolio manager and the panel’s second speaker. A key misconception about SRI is that it simply screens portfolios to avoid “bad” industries, like tobacco or weapons, for instance, she explained. Instead, SRI is really about “positive screening in favor of a company’s willingness to address tough problems and engage in social change,” Haboucha said.

Increasingly, SRI looks for synergies between a company’s social and financial performance. For the investor, that translates into managing portfolio risk for social consequences of corporate action or inaction (for instance, on climate change) and “asserting proprietary interest as a shareholder,” Haboucha said. “Once you realize you’re an owner, your attitude toward responsibility and power changes. You begin to realize you may have an obligation and some influence.” Globalization and communications technology, so they can’t rely solely on short-term financial results to bolster reputation.

In fact, SRI investors are at the forefront of investment issues, always anticipating tomorrow’s challenges. Said Haboucha: “There is an urgent need to change companies’ thinking from short- to long-term, and we, as socially responsible investors, have to help them. What’s important, if capitalism is to survive, is to reassert our ownership rights in the company.”

Part of being an owner is to face up to the fact that there are things companies do to promote sustainability that don’t save money, such as some upfront costs for environmental improvements. But some things that enhance sustainability do promote productivity. For instance, diversity efforts, such as “hiring women and really integrating them into the company,” can save money down the road, Haboucha pointed out.

The costs and savings of sustainability seem to even out in the end, since SRI portfolios have performed similarly to ordinary portfolios, Haboucha said. The important question, she concluded, isn’t whether portfolios perform better but “whether companies perform better.”

Giving Women Credit
“The highest-impact community investments are done with and by women, so they are the heart of the international sustainability movement,” proclaimed the panel’s third speaker Donna Katzin of Shared Interest, which funnels loans into South Africa.

A way to mobilize funds for poor communities, community investing provides financing to build sustainable communities-through, for instance, credit unions, loan funds and overseas community development projects. While investment in socially responsible funds has swelled eight percent to $2.3 trillion, community investing has soared 41 percent to $7.6 billion in the past two years.

“Women sustain life,” Katzin noted. In many places, they are also the family’s primary financial support. So, with micro-credit, women have greater social impact on the community when they borrow money. Women also have a higher loan repayment rate-99.2 percent for one micro-credit program in South Africa–and tend to reinvest the dividends in their families. In micro-lending programs, women sometimes come together in groups to borrow so they can cover each other if one falls short on periodic repayments, while providing support for each other and their respective businesses.

Sustainability of community development programs depends on partnerships, including some with corporations. And companies are starting to appreciate the stake they have in communities where they do business. Corporate responsibility offers companies the chance to take the lead in being good community actors, and women in companies have the vision to help guide corporations toward their own long-term interest in community investment, Katzin said.

Women provide leadership by asking the right questions and by connecting with each other, in poor communities and in groups like the Women’s Network for a Sustainable Future, said Katzin. She added: “All over the world, women are socialized to believe they’re responsible for making families and communities succeed. Performing those roles successfully makes women inherent managers.”

III. Network’s Next Event
The Network’s next event, will be hosted by GE subsidiary GE Structured Finance in the NBC Building at Rockefeller Center in New York City on June 24 from noon to 2pm. Called “Gender and Sustainability: Why Women Care More,” the luncheon panel will feature research from the Aspen Institute’s Initiative for Social Innovation in Business pointing to women’s greater interest for sustainability and social responsibility. The results set the stage to explore the following questions: Why do women appear to care more than men about these issues? How can their concern be harnessed in the workplace to foster a more sustainable, responsible business climate? What special qualities do women bring to the sustainability debate that can promote this agenda in the workplace and the larger community? How can the Women’s Network support businesswomen in effecting sustainability goals? And what specific programs and projects will make the Women’s Network most effective for participants? Please watch your email for an invitation. RSVP to: patricia.ricard@ge.com

IV. Network Concept
The concept of the Women’s Network for a Sustainable Future is to provide a forum for business and professional women to congregate, reflect and act on the converging issues of corporate social responsibility and sustainable development. Through meetings and simple electronic support tools, the Network aims to facilitate the exchange of experiences and best practices on these vital workplace issues. By creating a new network of executive women, the Network seeks to: improve responsible practices in workplaces; sensitize corporate culture more generally to issues of sustainability and social responsibility; and encourage a public commitment locally, nationally and internationally to sustainability principles.

The Women’s Network for a Sustainable Future is a 501c3 organization.
For more information, please contact:
Ann Goodman
Co-Founder, Women’s Network for a Sustainable Future
T: 212-243-4327
E: info@wnsf.org
Fiscal Agent: National Environmental Education & Training Foundation
1707 H Street NW, Suite 900
Washington, D.C. 20006
T: 202-833-2933
WSNF Board Member/NEETF Liaison: Deborah Sliter, Vice President of Programs

Board of Directors: Linda Descano, COO, Women & Co., CitiGroup; Muni Figueres, formerly of the Costa Rican Foundation for Sustainable Development; Joanne Fox-Przeworski, Director, Bard Center for Environmental Policy, Bard College; Ann Goodman, President, Telesis Consulting; Clair Krizov, Executive Director of Environmental and Social Responsibility, AT&T; Joyce LaValle, Senior Vice President, Human Resources, Interface Corp.; Kathy Robb, Esq., Partner and Head of Environmental Practice, Hunton & Williams; Deborah Sliter, Vice President of Programs, National Environmental Education & Training Foundation

Net Notes from the Women’s Network for a Sustainable Future Produced by Ann Goodman

“Plans to protect air and water, wilderness and wildlife are in fact plans to protect man.” – Stewart L. Udall

“Forget the damned motor car and build the cities for lovers and friends.” – Lewis Mumford

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