Impact Investing

We focus our impact efforts in three different areas.

  1. We integrate environmental, social, and governance factors into our investment process.
  2. We engage with management teams and boards to help them improve their impact.
  3. We invest in underserved areas of local communities, through our deposits in community-based banks and credit unions.
Environmental, Social, and Governance Factors

The Fund performs both negative and positive ESG screens on its investments, and the research involved provides us with important insights into a company’s culture and management’s ability to take a long-term view of the business. We apply responsibility screens as an important risk management tool. We also perform these screens to ensure that we own responsible companies with managers who make decisions with an awareness of their impact on the environment and on their community.

We exclude fossil fuel producers from the Appleseed portfolio along with several other industries including but not limited to tobacco, gambling, and weapons.  We also seek to make investments in companies that are making a positive impact through the product or service that they sell or by structuring their business processes in a socially and environmentally responsible way.

Engagement

Appleseed Capital votes on Fund proxies in a manner that considers shareholder interests and that encourages company boards to govern more responsibly.  Our votes support management incentives that are aligned with the creation of long-term, enduring value for stakeholders, encourage more transparent reporting on companies’ sustainability initiatives, and bolster boards’ efforts to balance the interests of its stakeholders. The following are recent examples of boards being held accountable through our engagement efforts.

  • Voted for a shareholder resolution with Avon Products requesting that the Board prepare a report on the company’s use of safer ingredient substitutes as they become available for chemicals that are likely to cause health problems.
  • Voted for a shareholder resolution with Staples urging the Board to provide shareholders with a report assessing the human rights risks related to the company’s supply chain.

Another way we encourage companies to become more sustainable is by submitting formal resolutions to ratify or request a specific action be taken by a corporate board.

Community Investing

Appleseed Fund generally holds between one and two percent of its portfolio in investments which have a direct, positive impact on local communities. We have allocated a portion of the Fund’s capital to CDs in various Community Development Financial Institutions (CDFIs). These CDFIs provide loans to individuals and businesses which are under-served by traditional banks.