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Listen Now! What If How You Invest Could Positively Impact the World?

This podcast shares how clients are choosing sustainable, responsible, and impact investments aligned with their values.

A man carries a crate of grapes in a field.

Let’s Talk About Wealth is a new podcast series that touches on compelling topics for families of wealth. Through stories and conversations with specialists from Wells Fargo Private Bank, we help listeners hear how others have discovered ways to make more impact with their wealth. In this episode, hear how families are helping to bring positive change with their wealth while pursuing financial performance goals.

Host: Noah Thomsen

Guests:

Jane Marie Petty, Director of Social Impact Investing Consulting, Wells Fargo Private Bank

Lloyd Kurtz, Head of Social Impact Investing, Wells Fargo Private Bank

Kimberly Ryan, Portfolio Manager on Social Impact Investing team with Wells Fargo Private Bank

Podcast Producer/Announcer: Caitlin Fenno

Podcast Transcript

[Announcer]:

Investment and Insurance Products are Not Insured by the FDIC or Any Federal Government Agency, are Not a Deposit or Other Obligation of, or Guaranteed by, the Bank or Any Bank Affiliate, and are Subject to Investment Risks, Including Possible Loss of the Principal Amount Invested.

[Noah Thomsen]:

Welcome to Let’s Talk About Wealth from Wells Fargo Private Bank. I’m your host, Noah Thomsen.

Today, our topic is incredibly relevant to the moment: Social Impact Investing. It’s often thought of as simply investing in companies which do good in the world. But it’s not that simple. For investors, it’s about those companies that have the foresight to address serious issues that may help them stay profitable for years to come. I was curious about what motivates someone to change the way they invest to include investments that align with their values. How do they go about it?

If you’re considering that approach, you’re hardly alone. I found out sustainable, responsible, and impact investing, as a whole, is a $30 trillion investment business, according to the Global Sustainable Investment Review, and it continues to grow.

In this episode, you’ll hear inside stories and candor from people who live and breathe this investment category. Specialists like my first guest, Jane Marie Petty.

Jane Marie is Director of Social Impact Investing Consulting with Wells Fargo Private Bank. She advises clients who want to make an impact with their wealth. They want to help bring positive change to the world, but they have financial goals they’re after, too.

Jane Marie, welcome.

[Jane Marie Petty]:

Nice to be here, Noah.

[Noah]:

First, can you give me a sense of what motivates a client to add a Social Impact Investing aspect to their portfolio?

[Jane Marie]:

Sure. I’d say we’re seeing more and more clients asking their investments to support their values. They want to make a difference and make an impact on issues that mean a lot to their family.

[Noah]:

Where is this change coming from, do you think? 

[Jane Marie]:

It’s not one place, really. It’s in the news. Financial advisors may talk about it. I, personally, am seeing younger generations in families of wealth introduce a new investing mindset. If you’d like, I can take you through a story.

[Noah]:

Sure. We all like a good story.

[Jane Marie]:

I think what’s happening is younger generations are asking the family, ‘Are we investing just to make a sizable profit, or can we have a meaningful impact, too?’

[Noah]:

Interesting.

[Jane Marie]:

Recently we met with a family who is in the process of handing over the reins for their private foundation to one of their adult daughters. She was an accomplished attorney who was very passionate about environmental sustainability and social justice issues. 

[Noah]:

Ah, okay.

[Jane Marie]:

During the meeting, the daughter said she wanted the investments in the portfolio to reflect her socially conscious values. By asking about investments through a personal-values lens, she introduced a new investing mindset to the family.

[Noah]:

Wow.

[Jane Marie]:

I call this a triple-bottom-line set, where the goal is to seek profit, purpose, and impact.

[Noah]:

Interesting, okay.

[Jane Marie]:

We introduced this family to Social Impact Investing, and discussed ways in which she could incorporate her environmental and social justice values into the family’s investment portfolio. I think the story captures how the conversation about money and investing is changing.

[Noah]:

Thanks for sharing that, Jane.

Next up, I’m joined by two strategic specialists in Social Impact Investing with Wells Fargo Private Bank. Lloyd Kurtz, head of Social Impact Investing.

[Lloyd Kurtz]:

Thanks for having me.

[Noah]:

Sure. And also, we have Kimberly Ryan, a Portfolio Manager on the Social Impact Investing team. 

[Kimberly Ryan]:

Pleasure to be here.

[Noah]:

Lloyd, let me start with you. Talk about what you see changing or shifting with today’s wealth clients.

[Lloyd]:

I’d say giving just to give—to be charitable or to do good—may be declining.

More and more, we’re seeing clients invest with a goal of growing the giving, so the good outcomes have the potential to go further and make a greater impact in the process.

[Noah]:

That’s interesting because my preconception is that people choose Social Impact Investing to show support for companies that do good. I didn’t think about growing the giving, as you say. Kimberly, what’s your sense of the social impact investor today?

[Kimberly]:

I’d say these clients are more socially aware. They are thinking about more than just wealth accumulation or preservation, but how that wealth can be a force for good. When we speak to our clients, many of whom are baby boomers, they see a very different world than they grew up in. And they’re concerned about the state of the world and what it will mean for their grandchildren.

[Noah]:

Yeah, that makes sense, especially now.

[Kimberly]:

Definitely. So they want investment portfolios that are aligned with their family’s values. The most prevalent issues are related to concerns about the environment like climate change, pollution, waste. There’s also deep concern about workers’ rights and income inequality. I think those are some of the most pressing issues. Wells Fargo and the SII team, you know, help to customize the client’s investment plans. And we work with them to blend their social impact interests and their financial performance objectives.

[Noah]:

Hmm, interesting. Okay, I’m learning as we go. Thanks, Kimberly.

Now, Lloyd, regarding families of wealth. I’ve seen a study that shows a growing percentage of new families of wealth are self-made. I’m curious: Do these families have some built-in affinity toward making a social impact with their investing?

[Lloyd]:

Yeah, I’d say so. In the last 20 years, most personal wealth has come from innovation. People who started companies that invent, disrupt, and create change. And their success came from a respect for data. They measured and adjusted to meet performance goals in their companies. And now, with their personal wealth, you’ll see these same wealthy clients believe their Social Impact Investing should target performance goals and address societal, climate, health issues. The values that are meaningful to them.

[Noah]:

Hmm. That’s interesting. I’m curious: Do clients ask about a corporation’s behavior?

[Lloyd]:

Definitely. They see how a corporation acts, and how they believe the company’s leaders would act in certain situations. We’re seeing movement from an industrial-age thinking to an age of sustainable development. Sustainable agriculture. Clean water practices. Concerns about the supply chain. I think it’s fair to say that people of wealth are helping inject a wider interest into issues with their Social Impact Investing.

[Kimberly]:

I agree with Lloyd. And I’d like to add something that I’ve seen with the COVID pandemic.

[Noah]:

Please, by all means.

[Kimberly]:

There’s really no better time to see and judge corporate behavior than during a crisis. You can see which companies are remaining true to their mission. Being proactive. Adapting. Finding ways to do good while also being profitable. Companies are tackling really serious issues today. Ones that will impact the world in the decades ahead.

[Noah]:

We’re certainly seeing that, aren’t we?

[Kimberly]:

Yeah. We’re telling our wealth clients that companies should already be preparing for things like climate change, or disruptions to their supply chains, overall issues of sustainability – and those that are not are risking long-term underperformance as these conditions change.

[Lloyd]:

I’d just like to add, overall, we advise our clients to ‘be true to yourself’ in what you invest in. We can help inform. But they choose where to make their impact.

[Noah]:

It is a very dynamic area for investing. And at a pivotal time in the global economy. Thank you both for talking with us and sharing.

[Kimberly]:

My pleasure.

[Lloyd]:

Thanks for having me.

[Noah]:

So, that’s our show. Join us again for more inside stories and opinions on Let’s Talk About Wealth. In the meantime, if you would like to learn more about Social Impact Investing, you can find helpful links on our podcast page. Or on the Conversations magazine website. This is Noah Thomsen. So long for now.

Music

[Announcer]:

All investing involves risk, including the possible loss of principal. An investment’s social policy could cause it to forego opportunities to gain exposure to certain industries, companies, sectors, or regions of the economy which could cause it to underperform similar investments that do not operate under a social policy. Risks associated with investing in Social Impact related strategies can also include a lack of consistency in approach and a lack of transparency in manager methodologies. A socially responsible investing style may shift in and out of favor. This commentary is not a complete analysis of every material fact in respect to any company, industry, or security. The opinions expressed here reflect the judgment of the speakers as of the date of the report and are subject to change without notice. Any market prices are only indications of market values and are subject to change. The information contained herein is based on technical and/or fundamental market analysis and may be based on data obtained from recognizable statistical services, issuer reports or communications, or other sources believed to be reliable. However, such information has not been verified by us, and we do not make any representations as to its accuracy or completeness. The material has been prepared or is distributed solely for information purposes and is not a solicitation or an offer to buy any security or instrument or to participate in any trading strategy. Additional information is available upon request.

Wells Fargo Private Bank provides products and services through Wells Fargo Bank, N.A. and its various affiliates and subsidiaries. Wells Fargo Bank, N.A. is a bank affiliate of Wells Fargo & Company.

Brokerage services are offered through Wells Fargo Advisors. Wells Fargo Advisors is a trade name used by Wells Fargo Clearing Services, LLC and Wells Fargo Advisors Financial Network, LLC, Members SIPC, separate registered broker-dealers and non-bank affiliates of Wells Fargo & Company.

Wells Fargo Bank, N.A. offers various advisory and fiduciary products and services including discretionary portfolio management. Wells Fargo affiliates, including Financial Advisors of Wells Fargo Advisors, a separate non-bank affiliate, may be paid an ongoing or one-time referral fee in relation to clients referred to the bank. The bank is responsible for the day-to­day management of the account and for providing investment advice, investment management services, and wealth management services to clients. The role of the Financial Advisor with respect to Bank products and services is limited to referral and relationship management services.

Wells Fargo & Company and its affiliates do not provide legal or tax advice. Please consult your legal and tax advisors to determine how this information may apply to your own situation.
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