While working at KLD Research and Analytics (a socially responsible investment research firm), I became aware of the lack of SRI tools for independent investors. Most SRI funds and research outfits work primarily or exclusively with institutional investors and large public pension funds. There is a lack of awareness among independent investors about SRI funds, opportunities to invest in more environmentally/socially responsible companies, and information about the ROI on those SRI opportunities. As a result, individual investors who might be interested in SRI must do their own SRI research (which makes them absorb an opportunity cost for that time). It also forces investors to locate and pay for an advisor that specializes in this, which raises fees and may not deliver a return that matches the fees.
My idea is to create some type of online tool to help independent investors invest in SRI funds and companies with positive social/environmental performance. It would kind be an SRI version of Ameritrade or E*Trade on which investors can learn about and invest in a variety of SRI funds or make single trades based on companies’ social and financial performance. My theory is that if you can make SRI more accessible to independent investors and demonstrate that returns can be decent, you can tap into a large market of socially-minded independent investors and small social ventures who like the idea of SRI but have limited means and time to find a money manager knowledgeable about SRI strategy. My goal is for the holdings to be quite liquid so that lower-net-worth investors (i.e. younger people) have an incentive to save and invest their money but still be able to “withdraw” it easily. The tool should focus on ease of use, point-of-investment information about social responsibility, and quality of investment opportunities.
Ways that others can help/get involved in launching this business plan:
- Web-development and software engineering
- Research – researching ROI of SRI funds; developing and executing framework to select socially responsible companies
- Marketing – assessing market for individual investment in SRI
- Product development
- Business plan development
- Development of SROI (social impact assessment)
Megha Doshi | MBA Candidate 2009 | UC Berkeley Haas School of Business
1.224.875.2368 (mobile) | megha_doshi@mba.berkeley.edu
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