“Most ethical investment strategies reflect incoherent thinking about morality. Anyone seriously concerned about the moral life should really worry about the ‘ethical investment’ movement.”
– U.S. stock guru Samuel Gregg

Is the phrase ‘ethical investment’ an oxymoron?

Deb Abbey doesn’t think so. Abbey, founder and CEO of Vancouver-based Real Assets Investment Management, believes that with careful planning, revenue and integrity can go hand in hand.

And she tackles the issue head-on in her new book, Global Profit and Global Justice: Using Your Money To Change The World (New Society Publishers). While the first chapter opens with a series of nightmare statistics outlining global realities such as the exponential growth of HIV and increasingly limited access that human beings around the world have to clean water, Abbey insists her book is actually about hope.

“I think many of us have lost faith in our governments. Corporations are becoming more and more dominant in our lives, and people feel helpless in the face of those corporate giants,” Abbey said in a recent interview.

“But we interact with these companies every day as investors, consumers, employees, suppliers and especially as communities. That’s clout, and we can use it to hold them accountable for their impact on our society.”

Deb Abbey

Globalization is inevitable, Abbey believes. But instead of protesting, she suggests embracing the power of investment dollars to ensure that companies around the world behave ethically.

While she sees anti-World Trade Organization protests as having a valid role, she has a different suggestion for corporate shareholders, proposing directing their
energy into creating a vibrant global community with a sustainable environment.

“I believe social and environmental activists draw attention to the issues in a very different kind of way, but I think we need a number of strategies.”

She points to her focus as an investment manager on long-term shareholder value. “The best way we can contribute to the solution is to be active shareholders and press companies to improve their social and environmental performance.”

In the book, Abbey cites a range of examples where her company and others have acted to change corporate practices in Canada and around the world. While she doesn’t recommend Talisman Energy to investors for a number of reasons, she cites the Calgary-based oil company as a good example of how shareholder pressure can work. Talisman came under increasing scrutiny over its operations in the Sudan, later admitting that shareholder pressure and a drop in share value caused by the publicity had convinced them to sell off their assets last spring.

Social investing is a phenomenon that has been slow to take off in Canada, Abbey says.

“Canadians have tended to rely on our government to solve all our problems and the dominance of corporations has kind of snuck up on us,” she says. Until recently, she adds, the most common form of investor activism has been to screen companies out of investor portfolios.

“Years ago, I would call up these companies and tell them why we were advising investors against them, and frankly, they didn’t care. That’s why it takes multiple strategies to effect change.”

Abbey and her co-writers Tim Draimin, Adine Mees, Coro Standberg and Perry Abbey outline other examples of the power of shareholder might for right. And they don’t limit their social activism to shareholders. The roles that individuals can play in community investment, pension control and consumer action are also investigated.

In a chapter titled Mosquitoes for Change: Consumer Action, Abbey quotes Anita Roddick, founder of The Body Shop. “If you think you’re too small to have an impact, try going to bed with a mosquito in the room.”

Abbey has also co-authored The 50 Best Ethical Stocks for Canadians in 2001 with Canadian social researcher Michael Jantzi.

She based the book on the experience she has garnered at the helm of Real Assets, the first investment management firm in Canada to focus exclusively on socially responsible investing. A long-time advocate of ethical investment, Abbey is also vice-president of the Board of Canadian Business for Social Responsibility.

She says she has always been interested in investing, starting early as a child playing at stock-ticker and keeping an eye on small investments bought for her by her father.

In the early ’90s, while working as a project director for the David Suzuki Foundation, she became interested in the concept of using multiple strategies for leveraging capital for social change.

“I was talking to a friend in the investment business and was inspired by the fact that no one was really doing this work in Canada,” she says. She worked her way through both CIBC Wood Gundy and Midland Walwyn before forming Real Assets.

There is a tight-knit, but growing group of socially conscious investors in Canada, she says. “People are starting to make the connection between poor management and companies that just don’t pay attention to their shareholders,” she says.

“Our tendency in terms of shareholder activism has been to focus on companies that are pretty good, decent companies and get them to raise the bar.”

Shareholder resolutions focus on a variety of topics, including the glass ceiling for female executives in Canada, the implementation of treatment and prevention programs for HIV/AIDS in sub-Saharan mining companies, water-use reduction, anti-sweatshop campaigns and promotion of Fair Trade products worldwide.

What’s next? Abbey laughs.

“There is a lot to do. We’re continuing to try to educate people in social activism and heighten awareness of pension trustees as to the impact they can have on their funds.”

Between launching her book and running her company, Abbey is finding herself much in demand as a public speaker these days.

“This is an idea whose time has come,” she says, and while conservative gurus such as Samuel Gregg may disagree, Deb Abbey is one mosquito with a lot of bite.

(Karen Dyer can be reached at karen@businessedge.ca)