CCM’s Chief Impact Strategist, David Sand, has more than 35 years of investment management experience and is a trailblazer in the socially responsible/impact investing arena. Recently, a member of our team sat down with David and asked him a few questions about his career and experience.
Q: What started your career in impact/ESG investing? Was there any specific catalyst(s) that led you to become a pioneer in the development of market-rate, fixed income impact investments?
A: Looking back, I can remember three early exposures I had to similar themes that laid the groundwork for most of my career. First, in college at Princeton University in the 1970s, I was involved in student government and anti-apartheid divestiture campaigns. My major was in American History so it was through my advocacy work that I learned about proxy voting and shareholder responsibility. Second, my first job after college was at the New York Public Interest Research Group which had been involved in the anti-redlining “Bank on Brooklyn” initiative. Hard to believe today, but at the time, much of Brooklyn was deemed “too risky” by banks who routinely denied mortgage applications from minority borrowers. Third, I took a job at Shearson Hayden Stone working for Robert Schwartz who was one of the very earliest practitioners of socially responsible investing. He and I had been introduced while working on a project to determine if electric utilities with nuclear facilities had a higher cost of capital than their non-nuclear peers. I didn’t realize it at the time, but my learning outside of the classroom prepared me well for the impact/ESG investing field that has developed.
Q: With over 35 years of investment management experience, how has impact/ESG investing evolved since you got started in the industry?
A: First of all, we can actually call it an industry now. That was not the case for many years. The mainstreaming of impact/ESG investing has accelerated such that it appears to be on the way to becoming an integral part of the investment business around the world and in all asset classes. It has taken a long time to debunk the myth that one must give up performance when incorporating one’s values into an investment philosophy.
Q: What questions should investors/advisors who are new to impact/ESG investing be asking when considering an investment?
A: The most important questions are internal ones. What are your priorities and values? What is most critical to you as a citizen and a consumer? How do you feel about having these incorporated into your investment program? How will you feel if your investments end up directly supporting industries and economic activities you oppose? Once the internal questions are answered, there are so many options in the impact/ESG product and services arenas that can be incorporated into the overall strategy.
Q: What new impact/ESG investing products/strategies are you working on at CCM and how did they come about?
A: Community Capital Management has a history of innovation in the impact investing field. With over $2 billion in assets under management and a nearly 20-year track record, we have great visibility regarding where the industry has come from and where it is going. Our clients are fantastic at letting us know what they see as emerging issues and opportunities. On the new business front, CCM is looking to build upon our impact/ESG equities business by adding new funds and strategies to our lineup. We are also looking very carefully at the new legislation that created Opportunity Zones and Opportunity Zone funds. Stay tuned for possible developments in that field.