How to make corporates rethink
Estimated reading time: 3 minutes, 21 seconds.
In my college years, I built an investment fund and we always wondered how can we invest in sustainable businesses. We ended up investing in Tesla and a fund that focuses on water-related companies. Our intent to have a positive impact on our investment was great. But did these investments create a positive impact? Recently, I wrote about whether Tesla is a social business (article). Also, the investment fund focusing on water investments… Was it actually pushing companies to use water resources carefully or did it take advantage of scarce water resources all over the world and surging water prices? Firstly, how can I as an investor know that my investments do good? Secondly, if they don’t how can I push them to become good? Gabe, co-founder of YourStake.org has an answer to that.
How to slowly transform companies such as ExxonMobil
Always engaged in social impact and climate change Gabe was always eager to change the status quo in the USA. The frustration that most citizens have with major corporations didn’t stop him from finding out how average people can impact the biggest companies in the world. He knew that there is a way to petition change being a shareholder of a US company. With his student-led investment fund at college, he was able to invest the minimum requirement of $2000 to file a petition.
With the support of one of his professors, Gabe was able to learn all the details about shareholder rights, petitions, and further regulations. After a semester-long training and a filed petition in 2015, he was able to speak on the annual shareholder conference of ExxonMobil in Dallas, Texas in 2016. At that point chairman Rex Tillerson rejected the proposal to disclose support for climate change denial organizations. Later though, as ExxonMobil felt continued pressure from investors and NGOs, ExxonMobil stopped funding the worst climate-denying organization.
Empowering the individual
The journey continued for Gabe in 2017 looking at the issue to empower the individual to have a positive impact. Through an academic analysis, it becomes more clear that there is yet a solution to be created. The academic research gave him really the last push to build something himself and together with his co-founder he started building YourStake.org in 2018. Now the platform launched after an open beta period.
It is pretty cool what the platform can do. You can simply sync with your retirement or investment account and you can easily join “asks” from the community through the existing shares that you own. Never before it was that easy to engage in petitions to push companies to do good and hold them accountable for their business practice. “Most investors simply don’t know that they can actually influence corporate decision making”, Gabe emphasized. Obviously, also institutional investors have a massive impact on that process.
Work with the big players
Institutional investors are large organizations such as BlackRock or Vanguard that invest money from individuals. Influencing those investors could really change a fair bit. So what YourStake.org does is not only sending petitions to corporates but also requesting environmental and social change from institutional investors. To gain extra power YourStake.org collaborates with leading individuals in the impact investing area that join forces with the community to bring forward their demands to the decision makers.
Strong support was essential for Gabe from the very beginning receiving guidance from one of his professors about petitions as a shareholder. In our interview, he also emphasized his co-founder. But really game-changing is the powerful individuals that advocate for the idea of YourStake.org and bring positive change to corporates that are still not taking the long-term implications of environmental and social detriment into account.
Accelerate into the future
The next step clearly is to make YourStake.org popular and known within the investor community. The design is very much a bootstrapping approach but the opportunity is huge. After the successful launch of YourStake.org, the team is looking into opportunities to become part of an accelerator program for social startups. However, the variety is enormous and the selection processes for programs are rigorous. Let’s see what the future holds for the team of YourStake.org.
16th March 2019 Munich, Germany