Page 16 RAIN Summer 1986 Joan Bavaria Darrell Reeck your checkbook, I'd know you pay $110 for a pair of shoes and give $10 to the"Gitl Scouts. I'd have an idea of your priorities. If I looked at your stock portfolio, you would be a rare person if I could get any idea of what you cared about. Money is very personal. The last thing you will tell anyone is how.much money you make or how much is in your stock portfolio. It's that intimate,_yet you haven't integrated it into your life. RAIN: Rather than SRI, why not make as much money as possible and then decide where to give charitable donations? Bavarja: We are a total system. In the end there is no way to divorce the ethical decisions from your investment portfolio. At some level people are making decisions on a social basis anyway. It becomes a question of whether you can have the same results in an ethically ~ntegrated portfolio. Who benefits from that housing? Two hundred andfifty households, 36% black, 23% hispanic, 40% white, 41% single-parent women heads ofhouseholds. We think that question will be resolved irrefutably.with a resounding yes. You can definitely have the same performance, so why not integrate your social values? Matthei: Many people are skeptical of the results. What is happening now is that all the funds of all different types are building a track record that will overcome that skepticism. The fact is that the Franldins, the Calverts, the Workirig Assets are posting returns comparable to unscreened portfolios. RAIN: In your experience, are you seeing that companies that have a more progressive approach outperform others? Bavaria: It would be presumptious to draw that correlaAmy Domini tion. What you can say is that th~y are smart companies. They aren't ignoring the bottom line, but they are sensitive to what's going on around them and sometimes they are survivors because of that. RAIN: It is often difficult to site relationsbips of cause and effect. Can you site instances where a company has been motivated by the SRI movement to change some of its policies? · Bavaria: One of the more recent and most outstanding is that AT&T has divested from South Africa and is offering its employees a South-Africa-free pension alternative. They have a very broad employee base and the employees and shareholders gave them a lot of trouble. Reeck: In the Puget Sound Area, a company that has just gone public is Micro.soft. They have done some innovative things. When they had investments in South Africa, they donated their profits from.South Africa to the American Friends Service Committee so that it went back to work for change in South Africa. More recently they decided to pull out of South Africa. RAIN: What would you suggest for the small individual investor? ' Bavaria: When you are just starting to save money you naturally start at a bank, and it gradually becomes big enough until you think of more creative investments. You might think about credit unions rather than the international bank. Credit unions are by definition neighborhood organizations that keep capital in the same neighborhood. There are some banks that are neighborhood-oriented. When you have several thousand dollars, the next step is a mutual fund. Unless you have $100,000 or closer to a quarter of a million its very difficult to be an investor in the stock market. RAIN: How can people dealing with a Board of Trustees convince them to shift principle investments for which they are responsible? Bavaria: If they are trying to convince a board or individual trustee, one of the first parameters is to remember that the money doesn't belong to the trustees-it belongs to you or to a church or to a pension. The ownership is really not with the Board, the Board.is to serve the owner. If you're
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