All Posts Tagged: Purpose Investing

Pioneers of impact investing: Q&A with Charly & Lisa Kleissner

Steve Prostano
Family Wealth Advisors

I always enjoy hearing stories of people who follow the path less taken. For example, what was it like to be a pioneer in the impact investing space when others were focused on traditional philanthropic giving? What challenges were encountered and what was learned along the way?

Charly & Lisa Kleissner leaning on a large tree branch.To answer those questions, I recently had the privilege of interviewing Charly and Lisa Kleissner, founders of the KL Felicitas Foundation and the Toniic global community of impact investors. Charly and Lisa offer fascinating insights into how the space has evolved – and ideas to take it to the next level. They are also the 2014 winners of the BNP Paribas Price for Individual Philanthropy, which recognizes philanthropic projects from around the world.

Steve: What were some of the reasons behind your decision to start the KL Felicitas Foundation? On a related note, what made you first decide to pursue impact investing through the foundation endowment?

Lisa: In 1999, while I was working as a consultant for the Community Foundation of Silicon Valley, several companies Charly and I had founder’s stock in went public. In a conversation with the then CEO, Peter Hero, I explored the options of a family foundation versus a donor advised fund. It was Peter’s recommendation that prompted us to set up a family foundation to allow us to direct the investments and create our own brand of philanthropy. In fact, Peter asked the foundation’s legal counsel to help us set up the foundation.

In parallel, I was struggling with what I considered to be questionable investment choices presented to us by our then investment advisor. Charly and I did a lot of soul searching, and we agreed to challenge the investment advisor to find investment opportunities that created a positive good as well as a return. That was in 2000. While we were not able to move forward until 2004, the more we explored the financial choices, the more determined we became to build a portfolio that we could be proud of. It ultimately took us 10 years! Today you can build an impactful portfolio in much less time.

Since first co-founding Toniic, what are some of the things that you have learned? Is there anything that especially surprises you?

Lisa: We have learned that everyone, no matter the size of his or her assets or personal economic circumstance, can participate in the transformation of finance. And that everyone must take their own journey into impact, at their own pace.

I was at the Skoll World Forum recently and Darren Walker, president of the Ford Foundation, said that the only poverty is a poverty of imagination. Impact investors, thankfully, do not lack for imagination. Our peers are re-inventing financial structures. For example, MA’O Organic Farms, a non-profit transforming the lives of families in Wai’anae, Hawaii – with the help of Total Impact Capital, a new generation of Impact Merchant Banks – built a financial model to successfully attract growth capital to scale their operations.

How do you suggest the wealth management industry fill the gap between what advisors know and what investors want so that we’re all on the same page regarding impact investing?

Lisa & Charly: This is a tough question to answer. The best strategy for the wealth management industry to fill the gap is to demonstrate that they care about impact, and that impact is not just a marketing gimmick. One of the most frequently asked questions in impact is about trust – can the advisor or the fund manager be trusted to truly deliver on the impact promise? Advisors can do this by getting educated about products and impact management approaches, processes, and methodologies, and by demanding more impact transparency (both on the positive and negative impact) from products they recommend.

If you could deliver one message to investors worldwide, what would it be?

Lisa & Charly: Wealth comes with responsibility; we believe it is the responsibility of those with wealth to invest for a healthy and prosperous people and planet.

 

For more insights and discussion with the Kleissners, check out my recent article in Family Wealth Report. Also check back next month for our second Q&A with Lisa and Charly about how to take impact investing to the next level.

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Impact investments: Bridging generations through shared values

Steve Prostano
Family Wealth Advisors
Rear view of young female traveler wearing large backpack and walking on a wood-plank bridge in the midst of sunny, heavily-wooded area.

Impact investments are made in companies, organizations, or funds with the intent to generate and measure social and environmental impact alongside financial return.

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Purpose investments: seeking financial and social returns

Steve Prostano
Family Wealth Advisors
Two young Asian men, possibly an entrepreneur and investor, looking at and discussing seedlings in a large greenroom.

Purpose investments are not a reason to accept concessionary returns, but rather are a method of pursuing both social returns and financial returns.

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‘You say SRI, I say…’: Defining the terms of purpose-built philanthropy

Steve Prostano
Family Wealth Advisors
Small group of colleagues looking at a strategy document as seen through a glass window with a hint of urban reflection

Ever wondered what exactly a Donor-Advised Fund (DAF) is? Our glossary has your answer.

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5 steps to becoming a more strategic philanthropist

Julie Shafer
Posted by Julie Shafer
Strategic Philanthropy
Back view of young-ish man looking out over a dark lake and horizon with blue mountains in the background.

These are great first steps for today’s donors who are looking for smart, personalized ways to make a meaningful impact on society for generations to come.

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