Mother-Daughter Duo: Linda Mason & Laura Merchant Discuss Their Road to Impact Investing
When WDN board member Linda Mason initially tried to shift her investments to align with her values, she was met with pushback. Now, over 20 years later, values-based investing has become a powerful part of the investing world. Linda and her daughter, fellow WDN member Laura Merchant, join us to share more about their road to impact investing.
Linda, your impact investing story started from one simple line in the sand: you didn’t want to invest in tobacco. What path did that take you down?
My background is in healthcare so the first time we met with a financial advisor (20+ years ago) my thought was, I don’t want our money invested in industries that harm others, and especially not tobacco and guns. It was frustrating because at that time, we were advised that excluding certain industries was not a financially sound option. This was also around the time I started my journey in philanthropy. As a philanthropist, my goal is not only “do no harm” but also, to do good.
Laura, what led you to impact investing?
I was inspired by my mom and watching her work to align her investments with her personal values, which was by no means a common practice when she first started.
Linda, how has your impact investing affected you as a philanthropist, a donor, or an activist?
In 2014 we switched financial advisors. With their help, we created criteria for exclusion of investments in firearms, military weapons, tobacco, and carbon/fossil fuel companies and a list of specific companies like NewsCorp. At the same time, they set up a screening process to incorporate social justice and environmental issues into our remaining publicly traded portfolio. Because our market investments are now in individual stocks we can react when issues arise. For example, following the Parkland shooting, we looked at retail stores that sell guns not just manufacturers. And we can participate in shareholder advocacy through As You Sow.
Our remaining portfolio is where we focus on doing good. In addition to what I would call traditional “fixed income”, with the help of our advisors we are moving more and more of our investments into impact funds. A sample of these include an international women’s micro-lending fund, a fund promoting quality jobs in lower income communities, affordable housing, and environmental funds focused on sustainable forestry, water equity, and sustainable oceans.
My shift to impact investing has added a lot of value to how I, as a donor, can use my money to address social justice issues like climate change and economic inequality.
Laura, if you could give one piece of advice to your former self when you first started this journey, what would it be? And what’s something you’ve learned from your mom about strategic giving?
This is a little specific, but I would tell my former self to be less fixated on avoiding capital gains taxes. It caused me to significantly delay transitioning a large share of my portfolio.
My mom is such a great model for doing due diligence around strategic giving. She identifies areas that feel particularly important to her and spends significant time researching the organizations in those areas that are on the frontlines of transformation and justice. She doesn’t make the organizations do the work of bringing her up to speed but, instead, signs up for newsletters, follows them on social media, and reads their websites and published reports. She also supports organizations over time and with unrestricted funds, something that I also appreciate as being core to the WDN model of giving.
WDN and WDN Action board members are leading the way with multi-year pledges to WDN and WDN Action so that we can make multi-year grants for 2022 and beyond. Linda, as a board member, why was it important to you to make a multi-year pledge? How does that long-term investment in WDN help bring about the change you want to see in the world?
Making multi-year grants is a goal for my philanthropy, and this is not my first multi-year grant to WDN. But this year is different. WDN has grown a lot over the last few years. We have amazing staff leading our grantmaking. We have amazing grantees doing the hard work on the ground. And we are going through a leadership transition. Now is the time to invest in WDN’s future and sustaining the future of our grantees. We need to be sure our finances are solid so the new President & CEO can focus on the work to be done.