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  1. 1. Sustainable Investment Solutions ™ A Custom Portfolio Design Process for Socially Conscious Investors Johann Klaassen, PhD. VP, Managed Account Solutions 1-800-422-7284 [email_address] Danielle Burns, AIF® Business Development Consultant 1-877-542-8583 [email_address]
  2. 2. First Affirmative <ul><li>Independent Registered Investment Advisor </li></ul><ul><li>Serving socially conscious investors </li></ul><ul><li>$593 million in client assets under management (09/30/09) </li></ul><ul><li>15 employees in Colorado Springs / Boulder /Denver </li></ul><ul><li>Nationwide network of locally focused financial planners and investment advisors </li></ul><ul><li>Signatory to the UN Principles for Responsible Investment </li></ul>
  3. 6. Sustainable Investment Solutions™ Getting to Know You Asset Allocation Implementation Reporting & Monitoring Changes?
  4. 7. Consultative Process <ul><li>First Client Meeting: </li></ul><ul><li>Advisor and client discuss how First Affirmative is uniquely positioned to serve socially conscious investors </li></ul><ul><li>Discuss needs, time horizon, risk tolerance, return expectations, social criteria, etc… </li></ul><ul><li>Complete Confidential Client Questionnaire </li></ul>
  5. 8. Confidential Client Questionnaire
  6. 9. Institutional Client Questionnaire
  7. 10. Portfolio Design <ul><li>First Affirmative develops a custom Proposal and Investment Policy Statement based on the Questionnaire and supplemental information </li></ul><ul><ul><li>Proposal includes asset allocation strategy </li></ul></ul><ul><ul><li>Funds, separate account managers, or a combination of funds and separate accounts </li></ul></ul>
  8. 11. Signature Please <ul><li>Advisor and client review and discuss the Proposal and IPS </li></ul><ul><li>Client signs Investment Advisory Services Contract </li></ul><ul><li>Client signs IPS </li></ul><ul><li>Client signs New Account Set-up Forms </li></ul><ul><li>Client provides Photo ID </li></ul><ul><li>Arrangements are made to fund the account </li></ul><ul><li>All signed documents must be received by First Affirmative before implementing account management strategy </li></ul>
  9. 12. Sustainable Investment Solutions™ Unified Managed Accounts for Socially Conscious Investors
  10. 13. <ul><li>We believe that investors must take responsibility for the impact our money has on the world. </li></ul><ul><li>We help clients make money and make a difference by consciously directing investment capital toward enterprises that contribute to a clean, healthy environment, treat people fairly, embrace equal opportunity, produce safe and useful products, and support efforts to promote world peace. </li></ul>At First Affirmative
  11. 14. <ul><li>We understand that investment returns over the long term are driven primarily by the performance of innovative, well-managed corporations that are themselves dependent on the health of the human societies and ecological systems that sustain all economic enterprises. </li></ul><ul><li>We offer investors an opportunity to consciously connect good fortune and good will, and help transform our world. </li></ul>
  12. 15. Combining Different Assets For a smoother ride…
  13. 16. Portfolio Target Target
  14. 17. First Affirmative Managed Mutual Fund Portfolios Historical Composite Performance Since Inception December 31, 1998 through Sept. 30, 2009 NET of all Fees and Expenses
  15. 18. Investment Strategies Asset Allocation ~ Diversification Hybrid Accounts Hybrid Accounts
  16. 19. Sustainable Investment Solutions™ Asset Allocation ~ Diversification
  17. 20. Who / What is Folio Institutional? <ul><li>Internet based platform custody, trading, and clearing </li></ul><ul><li>Provides stock trading services at much reduced costs compared to more traditional broker dealer firms </li></ul><ul><li>Allows for creation of up to seven folios – a basket of up to 100 securities – in each client account </li></ul><ul><li>Two daily 15 minute trading “windows” </li></ul>
  18. 21. Model Folio / Separate Account Managers <ul><li>Advisor Partners </li></ul><ul><li>SRI US Equity Portfolio </li></ul><ul><li>Large Cap Growth Portfolio </li></ul><ul><li>Large Cap Value Portfolio </li></ul><ul><li>SRI International Equity Portfolio </li></ul><ul><li>Custom Portfolio Strategies </li></ul><ul><li>Azzad Asset Mgt. </li></ul><ul><li>International Equity Folio </li></ul><ul><li>Bassi Investments </li></ul><ul><li>Human Capital SRI Portfolio </li></ul><ul><li>Boston Common Asset Mgt. </li></ul><ul><li>International Equity Folio </li></ul><ul><li>Global Currents ValueCore International SRI </li></ul><ul><li>CLS Investment Firm </li></ul><ul><li>Folio 1.0 </li></ul><ul><li>Folio 0.75 </li></ul><ul><li>First Affirmative Financial Network </li></ul><ul><li>FAFN / KLD: Large Cap SRI Folio </li></ul><ul><li>FAFN MidCap SRI Folio </li></ul><ul><li>Equity Income SRI Folio </li></ul><ul><li>Alternative Assets </li></ul><ul><li>High Current Income </li></ul><ul><li>Fixed Income Folio </li></ul><ul><li>Green Tomorrow Folio </li></ul><ul><li>Charles Sandmel: Municipal Bond Management </li></ul><ul><li>Heartland Financial </li></ul><ul><li>Equity SRI Portfolio </li></ul><ul><li>Balanced Portfolio (50/40/10) </li></ul><ul><li>Taxable Bond Portfolio </li></ul><ul><li>High Impact Mgt. </li></ul><ul><li>High Impact Folio </li></ul><ul><li>High Impact Growth & Income </li></ul>
  19. 22. Model Folio / Separate Account Managers <ul><li>Jantz Morgan </li></ul><ul><li>Large Cap SRI 50 Folio </li></ul><ul><li>Keel Asset Mgt. </li></ul><ul><li>Mid Cap Social Core Folio </li></ul><ul><li>Mid Cap Social Value Folio </li></ul><ul><li>Legg Mason Investment Counsel </li></ul><ul><li>Socially Responsive Core Equity </li></ul><ul><li>MMA Capital Mgt. </li></ul><ul><li>Growth Index </li></ul><ul><li>Value Index </li></ul><ul><li>Miller/Howard Investments </li></ul><ul><li>Global Utilities and Infrastructure Strategy </li></ul><ul><li>Income-Equity Strategy </li></ul><ul><li>Pax World Capital Mgt. </li></ul><ul><li>SRI Growth Portfolio </li></ul><ul><li>SRI GARP Portfolio </li></ul><ul><li>Portfolio 21 Investments </li></ul><ul><li>Domestic Equity Portfolio </li></ul><ul><li>Progressive Asset Mgt. </li></ul><ul><li>Large-Cap Growth Social Track Portfolio </li></ul><ul><li>Large-Cap Value Social Track Portfolio </li></ul><ul><li>Mid-Cap Growth Social Track Portfolio </li></ul><ul><li>Mid-Cap Value Social Track Portfolio </li></ul><ul><li>Small-Cap Growth Social Track Portfolio </li></ul><ul><li>Small-Cap Value Social Track Portfolio </li></ul><ul><li>International Social Track Portfolio </li></ul><ul><li>SKBA Capital Mgt. </li></ul><ul><li>Socially Responsible Value Portfolio </li></ul><ul><li>Strategic Partners Investment Advisors </li></ul><ul><li>Taxable and Tax-Exempt Municipal Bond Portfolios </li></ul><ul><li>Summit Investment Mgt. </li></ul><ul><li>SRI Catholic Values 100 Portfolio </li></ul>
  20. 23. Model Folio / Separate Account Managers <ul><li>Summit Portfolio Advisors </li></ul><ul><li>Socially Responsive Equities Hedged with Collars </li></ul><ul><li>Trillium Asset Mgt. </li></ul><ul><li>All Cap Core Equity Portfolio </li></ul><ul><li>Large Cap Core Equity </li></ul><ul><li>Small/Mid-Cap Core Equity Portfolio </li></ul><ul><li>All Cap Core Balanced </li></ul><ul><li>Large Cap Core Balanced </li></ul><ul><li>Uniplan Real Estate Advisors </li></ul><ul><li>REIT Portfolios </li></ul>
  21. 24. Advisor’s Role Is Critical and Clear <ul><li>Primary point of contact with the client </li></ul><ul><li>Develops a detailed understanding of client’s situation, financial objectives, risk tolerance, and social priorities </li></ul><ul><li>Monitors performance of the account and of the mutual funds and/or separate account managers selected </li></ul><ul><li>Meets with client periodically to monitor progress </li></ul><ul><li>Notifies First Affirmative of any changes in client’s financial situation </li></ul>
  22. 25. Asset Management Fees <ul><li>Maximum Fee to client: </li></ul><ul><li>First $200,000 1.55% </li></ul><ul><li>Next $300,000 1.50% </li></ul><ul><li>Next $500,000 1.35% </li></ul><ul><li>Next $1,000,000 1.20% </li></ul><ul><li>Next $1,000,000 1.10% </li></ul><ul><li>Next $2,000,000 1.00% </li></ul><ul><li>Next $5,000,000 0.80% </li></ul><ul><li>Next $10,000,000 0.70% </li></ul>
  23. 26. Compensation to B/D, RIA, Solicitor <ul><li>Mutual Fund Separate </li></ul><ul><li>Portfolios Accounts </li></ul><ul><li>First $200,000 1.00% 0.85% </li></ul><ul><li>Next $300,000 0.75% 0.81% </li></ul><ul><li>Next $500,000 0.65% 0.70% </li></ul><ul><li>Next $1,000,000 0.60% 0.61% </li></ul><ul><li>Next $1,000,000 0.52% 0.52% </li></ul><ul><li>Next $2,000,000 0.50% 0.50% </li></ul><ul><li>Next $5,000,000 0.40% 0.40% </li></ul><ul><li>Next $10,000,000 0.35% 0.35% </li></ul>
  24. 27. Member Services Program <ul><ul><li>‘Transformative Investing’ Social Network </li></ul></ul><ul><ul><li>Social Investment Forum Membership </li></ul></ul><ul><ul><li>IW Financial Advisor </li></ul></ul><ul><ul><li>Proxy Governance Database on Proxy Resolutions </li></ul></ul><ul><ul><li>Professional Profile on First Affirmative Website </li></ul></ul><ul><ul><li>Marketing Assistance and Leads </li></ul></ul><ul><ul><li>Subscription to Bob Veres’ Inside Information </li></ul></ul><ul><ul><li>Discount FedEx Labels </li></ul></ul><ul><ul><li>SRI in the Rockies Conference & Retreat </li></ul></ul>
  25. 28. BaseCamp SRI <ul><li>Regional Mini-Conferences </li></ul><ul><li>2010 BaseCamps: </li></ul><ul><li>Denver, CO </li></ul><ul><li>New York, NY </li></ul><ul><li>San Francisco, CA </li></ul><ul><li>Seattle, WA </li></ul><ul><li>Portland, OR </li></ul><ul><li>Learn more at http:// basecampsri.firstaffirmative.com </li></ul>
  26. 29. 21st Annual SRI in the Rockies Conference <ul><li>JW Marriott San Antonio Hill Country Resort & Spa </li></ul><ul><li>San Antonio, Texas </li></ul><ul><li>November 18–21, 2010 </li></ul><ul><li>www.SRIintheRockies.com </li></ul>Pre-Conference November 16-18, 2010 [email_address]

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