CSRHub Blog Research on ESG metrics and comments on sustainability best practice

Slow Money Waters the Crop

[fa icon="calendar'] Apr 17, 2012 3:51:35 AM / by Bahar Gidwani

by Bahar Gidwani


Slow Money is a national movement that seeks to fix our economy from the ground up, starting with food. The New York chapter has started growing quickly – they had to close registrations for a recent Meetup when they hit 70 people – about twice the capacity of the venue (Jimmy's 43, a great East Village bar).

The group sprang from a seminal book of the same name by sustainability visionary, Woody Tasch. As he pointed out, we all care about food. The New York chapter is connecting its members with food-related entrepreneurs and investors. They are also working on increasing access to capital for food companies who are trying to improve the sustainability of our food chain.

Slow money is a great example of a broad and growing grassroots movement to support and put money into smaller companies. For instance, we have recently learned of efforts in LA, Chicago, Western Massachusetts, and Colorado to funnel money into new sustainability-oriented ventures. This movement is also called “Common Good” investing. One of CSRHub’s board members – Ben Bingham – is currently launching a fund of positive impact funds that prioritize the common good (see www.3sistersinvest.com ) as part of 3Sisters Sustainable Management.

Sustainability-oriented entrepreneurs are planting the economic seeds of new crops of business models. Groups like slow money and these other funds are supplying the basic materials that new ventures need. Mentoring, marketing, and money are the basic soil and nutrients that make will make these new companies grow.


Bahar Gidwani is a Cofounder and CEO of CSRHub. Formerly, he was the CEO of New York-based Index Stock Imagery, Inc, from 1991 through its sale in 2006. He has built and run large technology-based businesses and has experience building a multi-million visitor Web site. Bahar holds a CFA, was a partner at Kidder, Peabody & Co., and worked at McKinsey & Co. Bahar has consulted to both large companies such as Citibank, GE, and Acxiom and a number of smaller software and Web-based companies. He has an MBA (Baker Scholar) from Harvard Business School and a BS in Astronomy and Physics (magna cum laude) from Amherst College. Bahar races sailboats, plays competitive bridge, and is based in New York City.

 

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To Those Who Have Much, More Will Be Given (Matthew 13:12)

[fa icon="calendar'] Mar 29, 2011 11:20:29 AM / by Bahar Gidwani

By Bahar Gidwani

 

There are a lot of “Top 50” or “Top 100” lists for corporate social responsibility (CSR) issues.  Companies get kudos for how they treat women, blacks or Hispanics; for their attitude towards climate change, ethics, or shareholder treatment; or for being a good place to work, nice to commuters, or good to working parents.

 

We currently track 27 of these lists, and aggregate their views into our CSR ratings.  We tend to see the same companies appear over and over on these lists.  Is this because there are a few great companies and everyone knows it?  Or is the concentration of attention and awards due to the fact that big companies have big PR budgets, fill out lots of questionnaires, and have products that everyone recognizes and respects?

 

Using the tools on our site, we found that companies in the Fortune 1000 (the 1,000 biggest US companies) got an average of 2.9 mentions on “top something” lists.  This compared to an average of 0.2 mentions each for another 1,087 smaller US companies that we track.

 

Of course, this could be because big companies perform better socially, than small ones.  After all, they have the resources to have strong training programs, good benefits, contribute to their communities, clean up their waste, cut their carbon use, etc.  We next used our tool to compare the distribution of overall ratings for US companies that are in the Fortune 1000 against those we track who are not.

 

  Thosethatgotget

 

The average overall ratings for these two groups are pretty close (using our eco-oriented user profile, Fortune 1000 companies get a 48.4 rating and non-Fortune get a 48.1).  However, it looks to me like an awful lot of the smaller companies are better than the big ones!  The average advantage for the big companies probably is due to that little group of big companies who are way to the right—with scores in the 70s.  Without their influence, big companies would probably look worse overall on our sustainability scores than small ones.

 

So, why do “them that got, get?”  I think big companies get more attention, praise, and rewards because they can spend a lot of time and money communicating their performance.  Big companies fill out surveys and questionnaires, send out lots of press releases, and can afford to send their people to conferences and training sessions.  The occasional small company that shows up on a “top something” list probably got there by chance or because they did a really super job on the issue that is being covered.

 

I’d like to see the folks who research these lists either dig a bit deeper or at least set up a side list for the best smaller companies.  Being on a top 50 or top 100 list is satisfying and rewarding for both the management of a company and its employees.  I see frequent mentions of these “wins” via company press releases, and I know they generate a feeling of pride and accomplishment among the people who are responsible for the achievement.  Big companies already get plenty of attention.  Let’s do more to ensure that smaller companies get their fair share, too.

 

 


 

Bahar Gidwani is a Cofounder and CEO of CSRHUB. Formerly, he was the CEO of New York-based Index Stock Imagery, Inc, from 1991 through its sale in 2006. He has built and run large technology-based businesses and has experience building a multi-million visitor Web site. Bahar holds a CFA, was a partner at Kidder, Peabody & Co., and worked at McKinsey & Co. Bahar has consulted to both large companies such as Citibank, GE, and Acxiom and a number of smaller software and Web-based companies. He has an MBA (Baker Scholar) from Harvard Business School and a BS in Astronomy and Physics (magna cum laude) from Amherst College. Bahar races sailboats, plays competitive bridge, and is based in New York City.

 

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