Capital Institute is proud to report that Peter Kinder, co-founder of KLD Research & Analytics and Capital Institute board member, is this year’s winner of the Joan Bavaria Impact Award. He was honored along with William Foote, founder and CEO of Root Capital, as this year’s winners of the fourth annual Joan Bavaria Awards for Building Sustainability into the Capital Markets at the opening reception of the Ceres annual conference, held in May in Oakland, CA.
The Bavaria Awards are given annually to two leaders working to move the capital markets toward a system that balances economic prosperity with social and environmental concerns. Separate awards are given for recent innovation and long-term impact. Bavaria, a pioneer of social investing, founded Ceres and Trillium Asset Management before her death in 2008.
Kinder received the Bavaria Impact Award. In 1988, Kinder co-founded KLD Research & Analytics, the world’s first for-profit investment research firm dedicated to the evaluation of corporate environmental, social and governance (ESG) performance and practices. KLD established the intellectual framework and metrics eventually used throughout the world to measure sustainability performance for publicly-traded companies.
Under Kinder, KLD was responsible for a number of important “firsts” in the course of its 21-year history. Its Domini 400 Social Index (now the MSCI KLD 400) was the first equity index that was screened for ESG factors and has outperformed its benchmark since inception in 1990. The KLD index family eventually numbered more than 20, including the first ESG exchange-traded fund (ETF) in 2005. KLD also developed SOCRATES, the pioneering electronic database of ESG reports. Before being acquired in October 2009 by RiskMetrics Group, KLD’s research and indexes fueled ESG integration into the investment decisions of 31 of the top 50 global asset managers and more than 400 other institutional clients.
Since 1983, Kinder has co-authored three books in the field and written hundreds of articles, which have found publishers on four continents. Now semi-retired, Kinder consults, writes (at www.TheBell.us), and serves on the boards and advisory boards of not-for-profits.
“KLD will be remembered for how we used our voice,” said Kinder. “To make the case for socially-responsible investing – to answer its critics and win over skeptics – it was not enough to produce credible, objective research. We also had to find and grow investor constituencies and financial-sector demand for sustainability data. Our mission was to establish the field’s credibility.”
Foote received the Bavaria Innovation Award. In 2000, Foote founded Root Capital seeking to fill the “missing middle” of finance in developing countries – the underserved gap between microcredit and commercial financial institutions. Root Capital provides access to capital, delivers financial training and strengthens market connections to small and growing businesses – such as farmer cooperatives – that build sustainable livelihoods and transform rural communities in poor, environmentally vulnerable places. Since Root Capital’s launch, it has provided $256 million in credit to 320 small and growing businesses in 30 countries throughout Latin America and sub-Saharan Africa.
Foote founded Root Capital after a career as a financial analyst on Wall Street in Latin American Corporate Finance, and as a journalist in Mexico and Argentina.
“It is humbling to be associated with such a visionary and intrepid leader as Joan Bavaria, whose example set the bar for all of us who follow in her footsteps,” said Foote. “We are honored to be part of the growing community realizing her vision for capital markets that build prosperity in underserved communities around the world.”
Peter Kinder’s acceptance remarks:
Thank you Ken Sylvester for presenting me with this Award.
At this point, honorees say how thankful they are, how much the award means to them. I am and it does. I can’t come up with a ‘new and improved’ way to say ‘Thank you’.
Now, honorees say, ‘I’m not accepting the award for myself. I’m accepting it for the team that was KLD.’
Again, there’s no better way to say it.
Start with the D and the L in ‘KLD’. Amy Domini introduced me to SRI in 1979. She has a unique resonance with the concept.
Out of her difficulties selling SRI services to mainstream investors came her idea for what became the Domini 400. Amy grasped that until SRI had its own benchmarks and analytics, it would not be taken seriously.
The L in KLD – Steve Lydenberg – added an understanding of the potential for the company research underlying the analytics. He saw its promise first for social change and second as a business.
Steve saw the necessity for rigorous research expressed uniformly for managers and institutions. So he and Lloyd Kurtz, now of Nelson Capital, put together SRI’s first electronic research database. On it we built KLD.
Amy’s and Steve’s insights guided KLD during its entire 21 year run.
The CERES staff have told me a hook will magically appear if I launch into an Oscar speech. So let me just say: Tom Kuh, Libby Edgerly, Dan Regan, Eric Fernald, Pat Colt, Tim Brennan, Darragh Gallant, Randy O’Neill, Noel & Michelle Friedman and Saul Schapiro. Thank you and your many fellow KLDers.
Finally I want to recall Joan Bavaria. I will never forget the winter day in 1983 Amy Domini and I spent with her on Long Wharf. We were working on our first book, Ethical Investing. Joan told us how the field worked, shared with us her vision – and her contacts – and encouraged us. For 25 years she continued to inspire me, through her last months when we talked about succession.
But Joan also challenged me. She understood the necessity to our cause of continual outreach and organization. Cause-related organizations attract people. And it’s individuals who advance causes. Trillium Asset Management, the Social Investment Forum, CERES: They’re hers.
We – the people gathered here by CERES – are her legacy. So, to Matt Patsky and Trillium and to Mindy Lubber, the CERES Staff and the CERES board, thank you. The Bavaria Award means the world to me.