Multi-Stakeholder Framework and Covid-19
I woke up this morning and began a conversation with my wife Emily. We were talking about our fears. We got “stuck” talking about our children. As 20 something year olds, each is living his/her own life across the US. Will is not going to graduate from college this year because that coming of age ritual was canceled. Charlotte, working as a nurse’s aid in a community hospital, is teaching us what it means to be a front-line responder. Nat, living in lock-down, is navigating social isolation alongside the homeless of San Francisco. Fiona is working from home too, her job at a school placed on hold. When I was in my 20s, I didn’t face the uncertainties that these four adults are facing.
As we reflect on COVID-19, thinking about our fears, we might learn about ourselves by thinking about other people’s fears. To make this easier, let’s think about four groups of people in the US with different perspectives, norms, and values. (Note, last week we explored the power and importance of relationships and how each of us is connected to each of these groups in varying degrees.) The first group of people are persons with a spiritual foundation – a faith in something larger than themselves. The second group are persons often called progressive liberals - they write checks to support the Natural Resources Defense Council and some of them used to be called social liberals and fiscal conservative. The third group are conservative persons who used to be fiscally conservative - perhaps this includes libertarians who are either in a state of denial or so committed to an ideological view that they hold (with white knuckled fear) to the steering wheel of their lives, with no intention of leaving the road that they are traveling. The fourth group of people are those invisible citizens who have lived for centuries in a state of fear, of oppression and stress. Disenfranchised from the systems that administer justice and the institutions that talk about equity, this group of people has faced injustice and inequities for generations. I know a lot about the first three groups of people. As COVID-19 barrels its way into our lives, I have been thinking about the fourth group.
In reciprocal relationships, people are connected. Social systems evolve to reinforce these structures and perpetuate people’s behaviors and attitudes. Pandemics arrive suddenly and shatter these structures and create confusion and dislocation. Faith is tested. Well intentioned and inherently ineffective progressive approaches are abandoned. Even the deepest adherent to an ideological viewpoint is forced to change: e.g., the ardent libertarian demanding that the government “do something!” The people who live in the margins of our society, whose views haven’t been heard for centuries, are caught up in the virus too. These persons know too well what it means to be silenced, to be invisible. Philanthropy and government support programs have not changed the trajectory of their lives; if investors sought more than simple financial returns, we might change the arc for marginalized communities. As we reimagine life after COVID-19, can we develop a new set of relationships or will we simply move to rebuild the institutions and systems that perpetuated gross unfairness?
Today, we have a chance to reimagine how those powerful systems that hold some of us up and that hold some of us down are failing. The miracle of technology that put a man on the moon in 1969 might not be able to save us from the global pandemics that confront our social order. Recall that it took over a decade to develop an effective antiretroviral therapy for HIV/AIDS; 75 million people have been infected to date, and 32 million have died: the vast majority in faraway places like eastern and southern Africa. The pandemic that we face today is affecting “us”, not just “them.” As you think about “us” and “them” in a US context, will we recover from this pandemic with a different understanding of who “us” are, or will we simply choose to embrace the old “order”? We have spent time working with clients to explore how best to align investment goals with “other” people. It’s been both challenging and rewarding work.
The TILT investment philosophy is grounded in a very simple principle that we call the multi-stakeholder framework. The multi-stakeholder framework is predicated on equity between three stakeholders:
the investor: individuals and institutions that seek to earn both a financial and non-financial return
the community: could be a group of people living in a place, a social or environmental issue or investment theme: e.g., renewable energy, or a condition that affects a group of people or a place: e.g., water supplies in Flint Michigan
the enterprise: the businesses, operating within a community, that consume and create multiple forms of capital. These may be for profit or not for profit; they may be large or small
The framework provides a critical lens to understand and align each of the three stakeholder’s goals. If you would like to learn more about the multi-stakeholder framework and our work to align with communities, please visit us at www.tiltinvestments.com
My four children are very likely to come through this challenging time, and I try not to worry about their immediate safety. I do worry about how capitalism and our financial systems and institutions will evolve to meet their individual needs and the collective needs of all groups of people.