Episode 15: How purpose can drive your impact

Oscarlyn Elder:

After you’ve thought through your purpose, what’s next? If you want to bring your purpose to life, now’s the time to align it with your wealth plan. Two common elements of a game plan focus on activities that impact your community and society, as well as investing that’s consistent with your values.

I’m Oscarlyn Elder, co-chief investment officer for Truist Wealth, and this is I’ve Been Meaning To Do That, a podcast from Truist Wealth, a purpose-driven financial services company. We appreciate you listening. We’ve discussed exploring your purpose in past episodes, and now we’ll take a deeper dive into several avenues you can take to express your purpose and create community impact.

My guests are two Truist Wealth colleagues who work with families and individuals on these activities. If you want to take notes on today’s episode, we have a worksheet you can download and print. You can find it by selecting this episode at Truist.com/DoThat. We’ll have two additional documents that provide more background on this subject at the episode webpage.

We’re also going to be discussing investing, so just a reminder that investing involves risk. The value of an investment will fluctuate over time, and you can gain or lose money. Additionally, investing with a sustainable lens may cause an investment to forgo otherwise investable opportunities. It may increase or decrease the investment’s exposure to certain types of companies, and therefore to possibly underperform investments that do not have a similar lens.

My two guests today are Colleen Silver and Bill Lyons. Colleen is the head of advisor engagement and sustainable Investing at Truist Advisory Services. Welcome to the podcast, Colleen.

Colleen Silver:

Hello. Thank you for inviting me.

Oscarlyn Elder:

It’s great to have you here. And Bill is the director of governance at Truist Wealth’s Center for Family Legacy, and he leads our Purpose and Community Impact Initiative. He joined us first in Episode 3 to discuss aligning your purpose with your financial plan. Welcome back, Bill.

Bill Lyons:

Thanks so much, Oscarlyn. It’s great to be back and here with you and Colleen today.

Oscarlyn Elder:

And I am really looking forward to our conversation. But before we jump into our conversation, let’s talk about your purpose. We know that purpose is important to us at Truist. Colleen, could you share your purpose with us?

Colleen Silver:

Absolutely. My purpose is to encourage empathy, start with respect, and to find the fun.

Oscarlyn Elder:

Colleen, I love that purpose for you and it really captures, I think, the essence of who you are. So, thank you for sharing that with us. Bill, how about you?

Bill Lyons:

Well, mine is to be a better brother, son, uncle, friend, and partner. When I look back on it, I think it’s so simple, but then when I really think about it, it’s so hard to actually do. And one of the people closest to me is struggling with a mental health issue, and I keep bumping up against that and how to live that out. So, what sounds incredibly simple is sometimes hard to live.

Oscarlyn Elder:

Bill, thank you for sharing that and thank you for being vulnerable and opening up. I think it’s very powerful to hear at a very high level that you’re experiencing some struggle and executing on your purpose. You’ve got a situation there that you’re navigating through. And my guess is that if we were all transparent, we’re all navigating some type of situation that impacts how we execute on our purpose. So, we’ll be thinking about you as you walk that journey.

Bill Lyons:

Thank you.

Oscarlyn Elder:

Let’s turn now and talk about values. Bill, in Episode 3, we spoke about the importance of tying your wealth objectives to your purpose. Today, we’re exploring how to bring your purpose to life. Where do you recommend someone start?

Bill Lyons:

For me, it all starts with values. And I love what you’ve done in the early, I think, the first two episodes to help people think about their personal purpose statements. And I think that Episode 2, there was a worksheet that had a set of values on it as a tool for people to think about their own values.

Our team at the Center for Family Legacy works with a digital tool, an online assessment that we help families assess their values against 125 values. And we use that as a tool to help families draft a family mission statement. And when you’re clear about what your family mission is, it becomes exponentially easier to write a family foundation mission statement or the mission statement for your business, or to structure your estate planning and investment strategies in alignment with your values.

So, to me, it all starts with values.

Oscarlyn Elder:

All right, so we’re starting the discussion with values, and we offer in Episode 2, at the Episode 2 webpage, there is a wonderful document that lists about 30 values. So if you don’t have the time to engage in exploring 125, we’re making 30 available to you. I personally went through that process and, for instance, know education is a value that’s near and dear to me. All right, so I’m grounded in education as a value.

We recommend that you use those resources and that you get to a place where you can articulate the values that are important to you and then ultimately to your family and to the way in which you really are in the world, your value system as a whole.

Bill, is there anything else that you would add around where to start the conversation?

Bill Lyons:

Yeah, I think that’s such an important point you made in terms of being able to communicate your values to others. So, as you’re thinking about, you know, should I create a family foundation or donor-advised fund or estate planning strategies, how well you can communicate to your advisors and others what values are most important to you are really critical.

And it’s such a pleasure to be here today with Colleen, who has been so thoughtful about— sustainable investing has shifted my thinking, has shifted our clients’ thinking, has shifted the way our institution thinks about sustainable investing.

And the statistics show that there’s $30 trillion in sustainable investing, and there’s $271 billion in philanthropy. And so it’s really fascinating to see the ways in which we’ve kind of crossed a threshold where families can have more impact in their investable assets or business ownership or other hybrid strategies than in their philanthropy, but that by no means minimizes the role of philanthropy.

There’s no time in history where I think philanthropy has had a more important role than right now. And there are certain things that philanthropy and the nonprofit sector can do, but it’s really an issue of both/and and not either/or.

Oscarlyn Elder:

And so to that end, Bill, the concept of “and,” what we’re going to be talking about today in part is really an attempt to illuminate the multiple avenues that are available to folks to make an impact. We’re going to start the discussion specifically with Colleen and sustainable investing. And so Colleen, sustainable investing, it’s not a new concept, but definitely people tend to have different definitions around it. Could you articulate for us, make sure we’re all on the same page for today’s discussion, what do we mean by the term sustainable investing?

Colleen Silver:

So sustainable investing truly does take many shapes, and that is OK. But, I agree, for this conversation it’s going to be helpful to define the term as kind of one common element. And at Truist, we talk about sustainable investing as a collection of investment techniques that help investors align their money with their values.

What else is similar about them is that they all consider an environmental or social theme, or multiple, and they consider those themes as a significant component of the investment philosophy and process.

I think it’s worth just digging into what environmental and social really means here. So, when we talk about environmental themes, there’s a few different issue areas within there, but generally we’re referring to the conservation of the natural world. Those issue areas I mentioned could include climate change and carbon emissions, biodiversity or waste management, and there are many more. Whereas the social themes, those generally refer to the consideration of humans, and those might be issues like affordable housing or labor standards or human rights.

So, quite a collection.

Oscarlyn Elder:

So, Colleen, you’ve illuminated for us a number of the different themes that tend to surface or ground sustainable investing. Are there specific techniques that you are seeing used within the sustainable investing space that’s important for our listeners to know about?

Colleen Silver:

Definitely. This is where some of the complexity starts to arise around sustainable investing, is that there are multiple investment techniques that kind of all fall under this bucket. Let’s walk through three examples so our listeners can begin to recognize what it is we’re talking about. And some of these terms might be recognizable.

The first technique I want to highlight is ESG, or environmental, social, and governance integration. This technique is focused on the financial materiality of those themes. What does that mean? Well, if you’re deciding to buy or sell a company, you might ask questions like, how is it going to affect the value of this company over time, how they manage their efficient use of natural resources? Or how impactful is it to the value of this company over time, how fairly they treat their employees? That focus on financial materiality is really what defines ESG integration.

Another technique is thematic sustainable investments. These target investments that are key drivers and beneficiaries of sustainable themes. So, you might think about a strategy that’s focused on making a climate thematic investment, investing in companies that are either trying to solve for greenhouse gas emissions by investing in technologies that are reducing those emissions, or perhaps they’re investing in companies that are producing technologies that help companies run their businesses more efficiently overall—therefore, again, reducing greenhouse gas emissions.

The last technique I’d like to highlight is impact investments. And even within this category, there are a few unique techniques. But to talk about them together at a high level, these investments are those that seek to generate a positive, measurable social or environmental impact right alongside a financial return. So, these are investments that are actually really intentional about moving the needle in any one of those issues or themes that I spoke about earlier.

Oscarlyn Elder:

And move the needle. Colleen, if you’ll just give us an example of some of the ways that you’ve seen these types of investments try to move the needle.

Colleen Silver:

Certainly. So, a great example of an impact investment would be a venture capital strategy, investing in the climate theme. Some of the underlying portfolio companies could be, for example, developing new technologies around battery storage, or maybe they’re focused on carbon capture technology. In doing so, they’re expressly up front saying these investments are going to take a certain amount of GHG emissions out of the air or prevent them from being released in the first place. And I should define GHG as greenhouse gas.

Oscarlyn Elder:

So, by impact, again, what you’re talking about there is the drive for financial return as well as some additional results that’s defined as a benefit in a specific area of focus.

Colleen Silver:

That’s right.

Oscarlyn Elder:

Colleen, you’ve given us a lot of great information, and I want to make sure that folks know that if they didn’t catch all of those details, don’t worry. If you go to the episode webpage, you’ll find a document that explains those terms and also provides information on sustainable investing techniques.

I also want to point out that values are extremely personal. What fits me may not fit you. There are so many possibilities for how someone may want to further explore or express their values and the causes that they’re passionate about. Avenues like sustainable investing may not resonate with everyone, and that is OK.

Bill, sustainable investing, as I just pointed out, it isn’t the only way to take action on your values and purpose, is it?

Bill Lyons:

Absolutely. There are so many ways that families and individuals are having impact in the world today. Philanthropy and charitable activities have traditionally been the place where people thought about utilizing their values to have impact on the world. But we also see a number of our clients who have an operating family business that see the ways in which they’re implementing their values every day and the care and concern they have for their hundreds or thousands of employees in the communities they live and work in.

We also have opportunities around estate planning to think about how you can implement your values. And then the final areas around family offices—for many families who are creating family offices or have a kind of family office mindset, that is a key driver of the impact that they’re having in the world.

Oscarlyn Elder:

Bill, is there an example out there in the popular press of someone who’s expressing their values and their purpose through the types of actions or avenues that you’ve just discussed?

Bill Lyons:

I think there are so many that are inspiring. One of the people that I think of most often in this space is Dr. Priscilla Chan of the Chan Zuckerberg Initiative and one of the largest kind of philanthropic entities in the country or the world. But it’s actually an LLC, for-profit entity that’s driving impact that also includes some family foundation vehicles.

But the work they’re doing investing in biomedical research and other things to cure diseases is really interesting. And Priscilla Chan is a pediatrician doctor in her own right, has really pursued her personal passion to pursue that and think about how to operationalize that in the investments they’re making to have impact.

That’s one end of the spectrum. And then the other end of the spectrum, we have 20- and 30-year-olds who are early on in building wealth. They are also so committed to kind of aligning their values in everything they do, from where they shop, where they vacation, how they give or how they invest, where they work—they’re kind of infusing values in everything.

So, there’s so many ways that our clients and families we work with are having impact. And it’s just such a privilege to get to do this work with families, to think about how to operationalize around their purpose and mission.

Oscarlyn Elder:

Bill and Colleen, I love that we’ve started this conversation around values. Next, let’s talk about the conversations you’ve been having with clients about their activities and making community impact as well as investing.

Bill, you work with families on sustaining wealth through generations. This includes a lot of discussion about community impact. What are some of the main lessons you’ve been learning and working with families?

Bill Lyons:

Well, one of the things I think is so interesting, particularly at this time in our history—a lot of families are kind of apprehensive about kind of trying to do things together, that there’s such polarization that we hear about in this country. And families may be feeling that and their families are worried about it.

But to me, when we get to do the work with families and sit down and talk about values, it actually brings them together in incredible ways. And so when I think about the kinds of things that some of the next generation are doing, thinking about ways in which they want to express their values—starting business, social enterprises—there’s incredible opportunities to connect with their parents or oftentimes grandparents who were saying, we were doing those kinds of things back before those were terms. That we were good neighbors. That we cared for our employees. When our name was on that product we manufactured, it lasted. They have this incredible opportunity to connect around shared values. You know, it sometimes takes a little bit of work to kind of create the right space to connect about those, but it’s been incredibly rewarding for us to do that work and for the families we’re working with.

Oscarlyn Elder:

Bill, you brought up a visual in my mind, at least, in hearing you, that makes me think about a family that I’ve had the honor of working with whom is really, really focused on their impact. And actually, I think if you use the word impact with them, that they actually probably wouldn’t even characterize it that way. This is just who they are. This is who they are in the world. It’s in their DNA.

And as I’ve worked with them, there are really different levels that I’ve been able to identify at which they’re making this impact. And so first and foremost, there’s a family business—very entrepreneurial, extremely successful—and they think about their clients and the impact that they’re making with their clients because their services are essential. So, I’ve heard the client lens.

I’ve also heard the employee lens. And so within their employee base, they are very intentional about and really incentivizing their employees to engage in the community, because they see their employees really as a leverage point to make even deeper impact within the community. Again, I’m not sure that they would use the word impact, but that’s how I’m translating what I’m seeing that they do.

And then they think about how their businesses and their employees are making economic impact for the community. So, they’re really focused on the economic impact within various local communities that they’re making.

So, that’s kind of one layer of efforts that I see. And then they also have a family foundation. And to your point, that family foundation, they’re trying to use that foundation as a mechanism whereby multiple generations can come together and have a place where they are discussing where they would like to invest within the community. Where do they want to see change? How does that align to their values? It’s a work in progress.

But it is an intentional effort that I’m seeing them make, and in addition to there being monetary support—because monetary support is very, very key, right, within especially philanthropic pursuits—in addition, this particular couple is also very actively engaged in personally leading, like, volunteer hands-on efforts. And so they’re out in the community. They are again, just actively engaged, promoting and working in various hands-on pursuits.

And they’ve articulated to me that they’re really modeling for others, what they’re doing, so that hopefully others will join in with them.

So, different layers of ways that this family is connecting, and I just want to point out again, I don’t know that they would use that word impact. And frankly, they would not use the word sustainability at all with the efforts that they’re undertaking. But they are very intentional around their values and supporting children and veterans and the local community and their employees and their clients with all that they’re doing.

Bill Lyons:

It’s such a great story. And it reminds me of the ways in which it’s all of these things. It’s not an either/or question—should I do this or that, but how do I do both of these things? And really, you know, thinking about the language that’s really meaningful to that family and trying to find kind of what is unique about their culture and the ways they want to have an impact on the world.

And so many of the times they may be making large philanthropic gifts, or they may be running a large business. But sometimes the most meaningful things they’re doing are the community service or serving on a board or volunteering at their children’s school—things that they think are small acts that are actually incredibly impactful to the communities they live in, impactful for modeling to their children or grandchildren.

So, it’s so amazing to see families like that are doing, you know, all of these things.

Colleen Silver:

So, I’m sitting here nodding along to your examples because I’ve also experienced this kind of value in these conversations among family members and especially multigenerational families, where you might have a more aspirational viewpoint coming from the younger generation, kind of, you know, in a little bit of tension with the more pragmatic viewpoints from older, more experienced generations.

But when you sit down and have these conversations, you can recognize that you don’t have to choose one avenue to execute your impact. Instead, they don’t need to be mutually exclusive, and these conversations can help identify the different parts of your wealth portfolio, the different parts of your philanthropic portfolio, where you can begin to make different changes and take different actions.

 The specific example of getting younger family members on the board of a foundation or at least involved in the decision-making there, that’s just a great learning opportunity for them to understand what’s happening in the investment side of the equation. And it’s also a great opportunity for the older generations to understand, hey, these aspirational points of view have a place, and the foundation could be a nice way to begin exploring what those are.

Bill Lyons:

And I just add that there’s a real opportunity for the converse to be true, that so often people think about philanthropy as a way to engage younger generations to learn about investing. I worked with a family that had a third-generation family foundation, and the younger generation was less enthused about the family foundation meetings but was actually really excited about private equity and venture capital.

And by doing that in a way, focusing on biomedical issues that related to the family’s values, they were able to get excited about the philanthropic purpose of the family. So, there’s way in which kind of both ends of the spectrum can add to families having more purpose. And it’s just such a privilege to get to help families operationalize on their purpose and mission.

Oscarlyn Elder:

That’s a fantastic story that you just shared there, Bill. And my observation is that families really do appear to find it fulfilling when family members can all have their really own unique passions but can find that connectivity from generation to generation. And I think we’ve all given some examples now of where that connectivity could potentially be found for many of our families.

Colleen, keeping to our theme of conversations, let’s turn for a moment to sustainable investing specifically. How can someone start a conversation with their financial professional about sustainable investing?

Colleen Silver:

One of the first things that you’d like to identify with your advisor, if you have an interest in sustainable investing, is understanding your “why” specific to this area. So, what is your motivation for wanting to be a sustainable investor?

We’ve identified four common motivations and those would include sentences like, “I just want to align my portfolio with my values.” Another common motivation might be expressed as, “You know, I’m not able to sleep soundly at night. I just want my portfolio to do no harm. I feel like I’m invested in companies that are in opposition to my values.” We call that do no harm.

Another motivation would be those investors who think that applying sustainable investing can actually improve their risk-adjusted returns. These might be investors who think that companies that are really attuned to their role in society, sensitive to how they treat their employees, careful about maximizing their environmental resource efficiency will actually be worth more over time, over the long term. And so those investors might lean into this particular theme because they think it can maximize their returns.

And then the fourth motivation, of course, is similar to what we mentioned before as an investment category—investors who are saying, “I want my wealth to make an impact now.”

To get at those motivations with your advisor, there’s a few sample areas you can discuss. And none of these is right or wrong, but you can choose a path that resonates with you. One of the things I like to ask is, what’s the first time you thought about sustainable investing? Where did you hear about it? Was it a news headline about a company that did something that you found offensive and you thought, “Oh my gosh, do I own them in my portfolio?

What does it mean to own that company?” Or maybe you’ve been involved in a nonprofit, committing your time and your resources, but started just wondering what else you can do, what other areas of your life you could move to support that cause.

If you want to get really down to, you know, “Give me some tactics,” there’s a few sample statements that you might react to. And I’m just going to read them through here, and there are plenty more, but these are a good place to start. So, ask yourself how you feel when you hear, “I think my portfolio is aligned with my values,” or “I think companies should be held accountable for unfair labor conditions,” or “I think companies play an important role in managing the pollution of our oceans.”

When you hear those statements, you might have any number of reactions, including “Meh, not important to me,” and that’s OK. Or they might lead you to ask more questions, and those are the thoughts and responses that you can discuss with your financial advisor, again, to get down to identifying what your motivation is. If none of those are really working for you, as we always recommend, you should bring up your emotions around investing to your advisor. When you think about your wealth, when you think about your investment portfolio, what emotions come up? Do you feel a sense of pride or are you uneasy about what you might be holding in your portfolio, or maybe both?

And then the last tip I’ll give is for those investors who come to their advisor and say, “Well, I care about sustainable investing because I care about it all. I want to do well.” And no particular theme feels really strongly resonant with you. You might take a look at where you’re directing your time and energy on the charitable side of the equation. Are you donating to particular causes? Are you volunteering at particular organizations? If you ask yourself what themes are common on that activity, that’s a good way to say, “Hey, maybe there’s an area that I can bring those themes into my investment portfolio.”

And then the last thing I want to say is that this is an iterative process. So when you sit down with your advisor, you might not end up with your motivation after a single conversation, but as you have multiple conversations, it will come to light. And then year over year, this is a conversation that you want to have again. You may change, your values and priorities might shift, and the size of your wealth may shift as well. And that will all inform where you want your focus to be here.

Oscarlyn Elder:

Colleen, again, thank you. That’s a lot of very, I think, impactful and important information that will help guide our listeners through how they might begin to start thinking about sustainable investing and having conversations around it, if that’s important to them.

Bill, the Center for Family Legacy has a process to help individuals and families decide how to express their purpose through impact. Can you walk us through that?

Bill Lyons:

Yes. And just like Colleen said, it’s an iterative, ongoing process. And we have a document that I think will be posted on the website for the podcast. And it’s the four elements of effective impact, the process to amplify your values. And it highlights kind of four elements of effective impact: clarity, action, analysis, and learning.

And this has been a tool that is helpful for people just at the beginning of the process. I’m working with a family that just sold a family business and are thinking about the next stage of their life where they want to have philanthropic impact, and they’re kind of really early on in learning. Another end of the spectrum, a family with a fifth-generation family business, third-generation family foundation, they are also finding a lot of value in the process framed like this.

To think about kind of clarity, oftentimes some of the donors are disappointed, they’ve made large gifts and they feel like, “Was that used the way I wanted it to? Did it have the impact I wanted?” Sometimes that’s due to a lack of clarity of the kind of impact they intended to have, and did they communicate that intent to the grantees that they were engaging? And then, you know, some donors can get stuck in that kind of clarity moment and be constantly thinking about internal questioning. And so we also encourage donors to kind of take action, to move to action, make some grants or investments and do some things that you can then reflect on and learn from.

So then the next stage is analysis, kind of doing some metrics around those grants you made or those investments you made, really being specific about the impact they’ve had, the numbers. You know, in an earlier podcast you had, you talked about kind of goals and the importance of defining goals with measurable numbers. So, the ways you can do some really deep analysis in the philanthropic sector has changed dramatically in the past number of years, where there’s a lot more focus on results and metrics.

And then the final stage is around learning—bringing that all together, which kind of re-engages the first steps around greater clarity. And so again, this is a process that is so helpful for folks early on in their impact process, and also for folks who are well-established who want to get better.

Oscarlyn Elder:

I love that you brought up action. Because part of our goal with this podcast is actually to move folks to action. And part of what I think is happening in the four points that you describe in this document, kind of our framework here is that at some point, you need to start taking some action.

And what I’m hearing, Bill, it sounds like an iterative process that can cycle many, many times and could evolve over time as well.

Bill Lyons:

Absolutely. And I’m thinking of the episode with Professor Fischbach, who said that a goal is not a goal unless you’re taking action toward it. Otherwise, it’s just an aspiration or a hope or a fantasy. And so I love the ways in which we can help families really operationalize on their purpose and mission.

Oscarlyn Elder:

As Bill just noted, the Center for Family Legacy has created a document explaining the four elements of this process. We’ve also made this document available at this episode’s webpage. So, we really encourage folks to go out and to look at it.

Bill and Colleen next, we’re going to explore trends and sustainable investing.

Colleen you lead Truist Wealth’s sustainable investing effort. What trends are emerging in sustainable investing?

Colleen Silver:

It’s so interesting, Oscarlyn. There are so many parallel trends happening in the sustainable investing space. One of the larger-scale trends that’s been happening over the last few years is that there have been shifts in global policy. There’s also been shifts in societal behavior. And both of those items are really driving innovation in the sustainable investment space.

They’re catalyzing the economic impact of environmental and social factors. And if you think about it today, all of us as investors, we have so much more transparency into business operations, into the sustainable data of the companies that we’re investing in. And when we have all of that new data, plus the technology innovations in the investment industry, we’ve just got a much broader toolkit today about how we as investors could express sustainable investing in our portfolio.

This might differ from, you know, the sustainable investing of 10 years ago, which largely was executed by removing investments from your portfolio that didn’t align with your values, or what we and others refer to as negative screening. That’s still a legitimate expression of sustainable investing, but there are so many more ways to express sustainable investing, if you want to, in your portfolio.

If I’m drilling down a little bit into trends, I want to just remind our listeners that there’s a big difference between what’s happening in the United States today versus globally in the sustainable investment universe. So, it is true that flows into sustainable investments here in the U.S. have slowed substantially and are starting to turn negative. But in Europe, the opposite is true. Flows have slowed a little bit, but they’re still positive. And actually, more than 80% of investors in Europe, when polled, say that they want to invest sustainably. So, just keep in mind that there’s a different dynamic going on from ones that we might read about in the news headlines here.

So, with that framework in mind, I’ll just mention that the sustainable industry is maturing. With any evolution and maturation of an industry, there’s going to be some growing pains. And in a way, this has been good, as regulations have started to come to fruition that are asking for more transparency from investment managers on how they’re investing sustainably. That has actually, in our view, improved the investment opportunity set. So, you’re seeing some funds close that maybe were not the highest quality or clearest expression of sustainable investing. And we are supportive of that, because what’s left are strategies that are really committed to the cause of sustainable investing and taking a very thoughtful approach to doing so.

The last trend I want to just touch on kind of goes back to what Bill was saying earlier, around we have more information and tools to measure impact, not only of philanthropic activity but also of impact investment activity. I think that has contributed to the trend that we’ve seen of specialization around some of those environmental and social issues in the impact investing world.

So, some of the earliest iterations and expressions of impact investments were multithematic, trying to create broad impact, really trying to gain a little bit of momentum around the idea of impact investing. But today, many of those issue areas and themes have also matured in their own right. The data has increased, we’re able to measure it more, and so when we see impact investments coming to market now, they tend to be, again, more specialized and focused on a narrow thematic investment opportunity set.

Oscarlyn Elder:

Colleen, this is why I really wanted you on the podcast. I’m hoping that what listeners really heard in your response was thoughtfulness and balance in approach to understand how the sustainable investing space is evolving and how that translates for our clients potentially.

Also, I want to pause for a moment because we want to make clear that making an impact on a community or within a specific cause does not require someone to like or even believe in sustainable investing. And I think we’ve already noted this before, that we certainly see situations with our clients where we have clients who are definitely not engaging in the techniques or the exploration that Colleen has just explained to us but that are very, you know, connected in through their philanthropic efforts around making impacts within their communities.

Bill, what trends are you seeing from your client families?

Bill Lyons:

One of the things that Colleen just talked about, I’m thinking about a family in particular that the wealth came from the CFO of a public company, and it was a conservative Catholic family. And at one point 30 years ago, they had had Catholic nuns showing up at the annual meetings protesting some decisions of the company.

And the family was so opposed to what they referred to as SRI, or socially responsible investing. And so I think that they were opposed to that, and then in talking with them about some of the new opportunities that Colleen has highlighted, I shared with them the statistic from our diverse asset manager team about the statistic that only 1.4% of assets in the United States are managed by women or people of color.

And so the widow of the former CFO and their oldest daughter were the key decision-makers in the family foundation. And that statistic, initially they were like, that can’t be true. It’s such a shocking number. And then it really shifted the way they were thinking about ways they could have impact and how Colleen has described so well the landscape has really changed.

Oscarlyn Elder:

Bill, that’s a very powerful example. And I want to point out to folks that the data that you just shared is from the Knight Foundation study around diverse asset managers. That study’s been updated, I believe, a couple of times, with the latest coming out not that long ago. So, that is verifiable data through the Knight Foundation study, if folks have an interest in going out and looking at that particular data.

But the story, from what you’ve explained, right, is that there’s a family that was really opposed to specific techniques, and what we’ve seen as an evolution and how they’re viewing making an impact with their portfolio based upon how times have changed.

Bill Lyons:

I think that’s right. And it also highlights one of the other trends I think is very significant in this space and their predictions about the $30 trillion wealth transfer and the amount of women that will be the key decision-makers. And so by 2030, we’re expecting to see a monumental shift in the amount of women who are the key decision-makers around financial wealth.

And it’s been fascinating. A nonscientific study with the families that I’ve worked with, there have been times where I’ve been working with families that are, there was three generations—a grandmother, daughter, and the granddaughter—making decisions about a portfolio. And they said, “If we’re going to do that with 5% of our portfolio, why wouldn’t we do it with all of our portfolio?” There are ways in which I think women are leading the space that are markedly different.

Oscarlyn Elder:

Well, Bill and Colleen, this has been a really engaging discussion at a very high level. I would like for us to zoom in now around some options for people when they want to live out their purpose through community impact or sustainable investing.

So, Colleen, what’s next for people if they want to work with their advisor to align their purpose with their investing? What are some of the techniques that we can give them?

Colleen Silver:

So, after you’ve started the conversation with your advisor, like we talked about earlier, your advisor can begin to understand which types of sustainable investments, some of those we covered on the podcast today, might be of interest to you and might also satisfy the motivation for your sustainable investing. Now from there, together you should talk about what those investments do, how they might differ from conventional strategies, and if anything changes about their risks. And altogether, those conversations are going to help identify if sustainable investing is right for your portfolio and in what form

Oscarlyn Elder:

Again, a note to the listeners—if you didn’t take notes on what Colleen just shared, don’t worry. We have a glossary with all of the sustainable investing definitions for you, as well as techniques posted at the webpage for this episode.

Bill, what can you tell us about common pathways people take for making a community impact?

Bill Lyons:

Well, there’s so many, and we’ve talked about some of the newer ways that people are having an impact. They are also the kind of classic, traditional ways in terms of family philanthropy and private foundations. Those are vehicles that have had a lot of benefit for families and communities.

Donor-advised funds are also a vehicle that a lot of families are using. I think Mike Frost on Episode 10 of your podcast talked about how donor-advised funds can be useful. And then I mentioned earlier on about how LLCs and family offices are structuring for-profit entities that are driving impact. We see a huge growth in the world of social impact and businesses that have kind of a, buy one, give one, kind of model. So, there are all sorts of entities that are for-profit, nonprofit, that are having impact. And then all of the estate planning—trusts, charitable trusts, all sorts of options for families to think about engaging our advisor teams and planning teams to think about the ways in which you can structure impact.

Oscarlyn Elder:

Colleen and Bill, this has been a truly meaningful conversation, and hopefully it’s going to help folks really get started on taking action related to their purpose and their values. Before we go, I’d like to ask each of you one question, and you probably know what that question is going to be. What’s the one thing you’ve been meaning to do but haven’t done and will commit to do in the future?

Colleen Silver:

So, I’ll go first, but I am embarrassed to say it here. I need to make an estate plan to help support my two young children. It’s been on my list for a while, and it’s time to take action.

Bill Lyons:

And mine is pretty similar, with thinking about beneficiaries or retirement assets and some changes that have happened in my family, and one family member who has kind of some special needs, and kind of thinking about a special needs trust and some other entities. And so direct financial gifts to them would not be optimal. And so thinking through how to structure some of those things, kind of updating some of the designations as they are now.

Oscarlyn Elder:

So, I relate to you both. My husband and I went through an estate planning refresh not that long ago. And so I just encourage you to get going on it because it can take a while. And then making sure that accounts are titled properly and that beneficiaries are set up as you would like them to be. It’s a process. It’s a journey. So, hopefully, this will compel you to action fairly quickly so that you can get those very important items marked off your to-do list.

Colleen and Bill, thank you so much for joining me today.

Colleen Silver: Thank you, Oscarlyn and Bill.

Bill Lyons:

It was great to be with you. Thanks.

Oscarlyn Elder:

And thank you for listening. Thank you for joining me today. As a reminder, we have two documents expanding on the conversation we’ve had on this episode’s webpage. Just select this episode at Truist.com/DoThat. And if you liked this episode, please be sure to subscribe, rate and review the podcast, and tell friends and family about it. If you have a question for me or suggestion for this podcast, email me at DoThat@Truist.com.

I’ll be back soon for another episode of I’ve Been Meaning To Do That, the podcast that gets you moving toward fulfilling your purpose and achieving your financial goals. Talk to you soon.

Colleen Silver is an investment advisor representative with Truist Advisory Services, Inc.