Alternative Investment

Finding Opportunities For Positive Change In A Challenging Year

How investors came together to harness the power of finance to build a better world—despite the world 2020 delivered

Domini Impact Investments LLC, a women-led impact investment firm, publishes its 2020 Impact Report. Learn more here.

May 06, 2021 — NEW YORK–(BUSINESS WIRE)–Domini Impact Investments LLC, a women-led impact investment firm, has published the Domini Funds 2020 Impact Report, which highlights how investors came together to harness the power of finance to build a better world—despite the world 2020 delivered.

In particular, the report underscores 2020’s most crucial topics—our climate crisis, the novel coronavirus pandemic, and racial and gender inequality. Each of these pressing themes is presented in context with how Domini sets its investment standards, puts its position as an investor to work for positive change, and invests to build vibrant communities. “Impact is when what’s ideal becomes what’s real,” says CEO Carole Laible. “This report is our reality.”

Key Impact Highlights:

  • Demonstrated how each of the Domini Funds’ carbon footprints are significantly less carbon intensive than their respective benchmarks
  • Invested over $20 million in green, social, and sustainability bonds to support the low-carbon transition and over $1.1 million with Community Development Financial Institutions to support access to capital for underserved communities
  • Refined and enhanced our key performance indicators (KPIs) to codify diversity metrics universally across all industries to better capture risks and opportunities throughout our research process
  • Updated key performance indicators (KPIs) for the financial sector to further address climate change and deforestation
  • Engaged 675 companies and issuers (52% U.S., 48% non-U.S.) with over 1,000 contacts on topics including: frontline worker health and safety, forest and Artic preservation, board diversity, climate change, and public health.
  • Filed our 300th shareholder proposal to work with companies on their social and environmental impacts
  • Launched two new mutual funds: the Domini Sustainable Solutions Fund and the Domini International Opportunities Fund

Excerpts from the Domini 2020 Impact Report

Impact Investment Standards

Our industry leading Impact Investment Standards are the framework that guides our research, analysis, and investment decisions to help us identify better investments. At Domini, we actively identify investment opportunities for our shareholders by integrating these environmental and social standards into our investment process. These social and environmental standards are applied consistently across all the Domini Funds and continue to set us apart from most other asset managers.

First published in 2005, we released our standards to transparently communicate to our shareholders which investments we seek to avoid through the use of our exclusionary screens, and which investments we seek to support. This level of disclosure aims to provide confidence to investors who wish to align their portfolios with their values. Through the application of our Impact Investment Standards, we build portfolios aligned with the Sustainable Development Goals (SDGs) that support the strength and resiliency of our social, environmental, and financial systems. At their core, the SDGs are inherently aligned with the fundamental goals Domini has pursued for over two decades: universal human dignity and
ecological sustainability.

As a woman-founded and women-led firm, we understand the importance of diversifying a field. Investors should play a role in enhancing diversity, equity, and inclusion in the workplace to mitigate investor risk and promote more equitable workplaces across industries. Companies with diverse leadership are more likely to avoid groupthink and have the potential to better understand customer needs, foster cooperation with their workforce and communities, and anticipate new societal trends and emerging issues. A diverse workforce can also improve a company’s ability to recruit from the widest possible pool of talent.

Investors should play a role in enhancing diversity, equity, and inclusion in the workplace to mitigate investor risk and promote more equitable workplaces across industries...

In addition, we believe companies have a responsibility to protect their employees from sexual harassment and identity-based discrimination. Indications of widespread issues in these areas have led us to avoid investments in particular companies. For years, our research has incorporated evaluations of diversity into our assessments of companies, noting a lack of diverse leadership in specific industries such as banking and retail as a negative.

In 2020, we enhanced our standards by codifying gender, racial, and ethnic diversity as a universal key performance indicator in our assessments of companies across all industries. Studies have shown that a “critical mass” of three or more women, for example, in the boardroom can cause a fundamental change and enhance corporate governance.

Exclusionary Screens

The following businesses do not meet Domini’s Impact Investment Standards and are not aligned with our goals of universal human dignity and ecological sustainability:

  • Weapons & Firearms: We have a longstanding policy to avoid investment in manufacturers of weapons, including military weapons and civilian firearms, which can be used to cause incalculable harm. We believe it is irresponsible to combine weapons manufacturing with the pressure to maximize profits.
  • Nuclear Power: We exclude companies involved in nuclear weapons production, as well as owners of nuclear power plants. We believe nuclear power technology presents significant risks to human health and safety, as well as the environment. We also have an exclusion on uranium mining.
  • Fossil Fuels: We exclude companies in the energy sector involved in oil and natural gas exploration and production, coal mining, oil and gas storage, transportation, refining, marketing, and related services due to the urgent need to accelerate the low-carbon transition and address the environmental, social, and financial risks of climate change. We also seek to avoid electric utilities with a majority of installed capacity from coal and exclude any utility that has announced or begun construction on new coal plants after the adoption of the Paris Agreement.
  • For-Profit Prisons: We exclude for-profit prisons and immigration detention centers due to the significant civil and human rights concerns that occur as a result of their business models, particularly for marginalized communities. We are concerned with the for-profit prison model which incentivizes imprisoning the greatest number of people for the longest duration at the lowest cost to increase growth and profits.
  • Alcohol, Tobacco, Gambling: We have never invested in companies that are significant manufacturers of tobacco products, alcoholic beverages, or significant providers of gambling goods and services. For these companies, effective marketing often means exploiting customers’ addictions to their products or lack of awareness of potential risks

Access the full report here.

 

 

 

About Domini Impact Investments LLC:
Domini Impact Investments LLC is an SEC-registered investment adviser specializing exclusively in impact investing. Domini serves individual and institutional investors who wish to create positive social and environmental outcomes while seeking competitive financial returns. Domini applies social, environmental and governance standards to all its investments, believing they help identify opportunities to provide strong financial rewards to its fund shareholders while also helping to create a more just and sustainable economic system.