Slide deck from presentation by Joby Gelbspan for Socializing for Justice ProfDev August 2016

1. 1
August 2, 2016
the Nonprofit Center, Boston, MA

2. Joby Gelbspan
2
NOT an investment advisor
Backgrounds in:
• corporate accountability activism
• history of corporate power & resistance
• financial analysis & investment management.
Reachable via LinkedIn or www.sojust.org

3. Corporations are not people*
* In reality, not legal obfuscation 3

4. “The most common way
people give up their
power is by thinking they
don’t have any.”
– Alice Walker
4
How can an investor be
“socially responsible?”

5. How can an investor be
“socially responsible?”
Making choices that promote our values
Solidarity
Owning your privilege taking responsibility for
financial choices & their effects on the broader
society, present and future
Sustaining yourself and to support your priorities
and those who depend on you
5

6. Part I: Investment Terms & Concepts
Part II: Political Strategies
Questions & Discussion to 8:30 6

7. Terminology: Types of Instruments
Bonds Stocks
Corporate (or government) debt. A share of ownership of the company.
Lower risk, lower return. Unlimited upside, unlimited downside.
Returns interest and gain or loss on sale. Returns gain or loss on sale, and sometimes
dividends.
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8. Drivers/Risks
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Fixed Income (Bonds)
Yield determined by interest rates and
the creditworthiness of the company.
Inverse to interest rate movements.
Equity (Stocks)
Corporate performance
Industry and market trends
More volatility, larger potential growth
Yield determined by the profitability of
the company.

9. Terminology: Types of Investments
Individual securities (stocks or bonds) are sold
by shares or dollar amounts.
Mutual Funds are companies that buy
portfolios of investments and sell units which
represent shares of the entire portfolio.
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XYZ Fund My Share of XYZ Fund
Apple - $4M Apple - $400
Johnson & Johnson - $2M Johnson & Johnson - $200
Nestle - $4M Nestle - $400
General Electric - $10M General Electric - $1,000
Total Fund: $20M I have $2,000 in XYZ Fund

10. Mutual Funds
• Types of Mutual Funds:
– Equity: holds stock
– Fixed Income: holds bonds or other types of debt
– Balanced: holds some blend of the two.
• Actively or Passively managed (index funds)
• ETFs are exchange-traded funds, usually
following an index.
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11. Terminology: Market Capitalization
• # Shares Outstanding X Price
• Small Cap: $300M - $2B
• Mid Cap: $2B - $10B
• Large Cap: $10B +
• “Mega Cap” newer, imprecise, > 100B
E.g. Wal-Mart (WMT) market cap > $258B
$469B revenue > the GDP of most countries
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12. Choosing a mutual fund
• Look for the prospectus and holdings
• Investment objective – e.g. international stock
or exposure to a particular country or industry
• Fees vary widely between funds and make a
big difference for your long-term returns
• Tool to diversify your portfolio
• Funds require less ongoing monitoring, but
won’t perform as well as good individual picks.
12

13. Public Companies
Listed on stock exchanges
IPO – initial public offering
Subject to public regulations & disclosure requirements
Dow Jones Industrial Average = 30 corporations, including:
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3M
American Express
AT&T
Bank of America
Boeing
Caterpillar
Chevron
Coca-Cola
Dupont
General Electric
Johnson & Johnson
Kraft Foods
McDonald’s
Microsoft
Pfizer
Verizon
Walt Disney
Walmart

14. Identifying Public Companies:
Start with what you know
Before investing, understand the key factors
driving and affecting the business
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15. Your Investment Goals
Are you learning this for:
• Saving for the long-term (> 3 years)
• Informing myself for future opportunities
• Organizing investors
Anyone working with shorter-term savings: may
need access in the coming 3 years?
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16. 16
Time
Risk
• Two ways to make money in the market:
time and risk.
• Higher risk = higher return. The price of
the investment is more volatile over time.
• As long-term investors, time is on our
side. We can afford short-term declines if
we can wait for the right time to sell.

17. Investing for Value
• Long-term investing, buy and hold
• Seek investments where we understand the
long-term value and are ready to commit to
owning a share for appreciation over years.
• DIVERSIFICATION spreads your exposure to
each investment’s individual risks.
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18. Asset Allocation
Mix of stocks, bonds and funds depends on our
two key factors: time & risk
Rule of thumb used to be: age % in fixed income.
E.g. at 30 years old, 70% stocks and 30% bonds.
Start conservatively, and spread your risks. 18

19. But these are unusual times…
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20. “a good strategy works best when you use it.”
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“Be greedy when others are fearful” is
easier said than done.
Stock market up ~ 10% on annualized
basis over the past century.
Over that period, the market declined
one year out of every three.
Establishing your goals and style will
give you the confidence to follow
through in the times that test us.

21. THE FACTOR OF TIME
 Long-term “buy and hold”
investments: ride out short term dips &
bounces
 Make a couple of good choices, and
try to forget about them
 The most you should check your
investments is about monthly 21

22. Questions at this point?
22
Do we all feel comfortable with these basics first?
Next up: making politically-informed choices

23. How can an investor be
“socially responsible?”
Making choices that promote our values
Solidarity
Owning your privilege taking responsibility for
financial choices & their effects on the broader
society, present and future
Sustaining yourself and to support your priorities
and those who depend on you
23

24. Conscious Choices
Industry Exclusions
– Pharmaceuticals
– Prisons
– Military Contractors
Corporate Behavior
– Environmental responsibility
– Policies on gender or racial discrimination
– Best in class
Proactive Support
– Community lenders, infrastructure
– Clean energy
– Social ventures, microfinance
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25. Socially Responsible Investment
Companies (SRI’s)
Dramatic growth, wide range of products to suit
different investment goals.
Examples:
• Domini
• Calvert
• Green Century
• Pax
• Parnassus
• Walden
• Increasingly, 401(k) and other plans offer SRI
funds
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No longer a fringe movement:
Today, more than $1 of every $6
under professional management
in the US – more than $6.5
trillion – uses SRI criteria.

26. SRI Funds
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Pro’s
 Investment Criteria, screens
 Build progressive capital
 Proxy voting
 Shareholder engagement
Con’s
 Limited definition of
“responsible”
 Diversifies risk and return
 Fees
Use these tools when they serve your plan

27. Shareholder Resolutions
• GMOs
• Fracking
• Board Diversity
• Packaging
• Climate change
• Marketing practices
• E-Waste
• Political interference
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28. Shareholder/Stakeholder Activism
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Changing policies & practices
Raising public visibility
Amplifying activism within the
Boardroom

29. Stock Picks:
Due Diligence
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Do your homework
Research:
• Corporate Behavior
• Corporate
Performance

30. Researching Corporate Behavior
• http://corp-research.org/
• http://www.goodjobsfirst.org/violation-tracker
• Limited only by your search terms!
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31. Researching Corporate Behavior
• Shareholder resolutions:
http://www.iccr.org/shareholder/trucost/index.php
http://faireconomy.org/shareholder_activism
http://www.greenamerica.org/socialinvesting/sharehol
deraction/index.cfm
• OpenSecrets.org
– Contributions
– Lobbying
– Revolving Doors
– Congressional Ownership
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32. Researching Corporate Performance
• Annual Report & Financials (sec.gov)
• Investor section of the corporate website
• Yahoo! Finance or other investor coverage
• Consider the industry and the long-term value
proposition
• Assess the risks
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33. Yahoo! Finance (or Google, etc.)
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34. Community Investments
• Environmental justice: closed
food loop
• Cooperative, democratic
workplace
• Zero waste innovation
• Local food & solidarity economy
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Cooperative
Energy,
Recycling &
Organics

35. Community Investments
http://www.bostonujimaproject.com/ https://www.facebook.com/bostonujimaproject/35

36. Online Resources
• Terminology / Glossaries:
– www.investopedia.com
– www.investorwords.com
• Researching investments or markets
– www.yahoo.com/finance or Google
– Bloomberg, other news agencies
– Commentators and blogs
e.g. Motley Fool: http://www.fool.com/
• SRI’s
– www.ussif.org
– http://www.socialfunds.com/ 36

37. Community Resources
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38. Thank you for coming!
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…and cast your vote for the Corporate Hall of
Shame at www.stopcorporateabuse.org
Refuse to be intimidated
Continue to learn and share
Connecting for Justice
10th Birthday Party
Thurs. Sept 22