A better quality return

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James Perry, Co-founder, Snowball

Fri 1 September 2023

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What world changing returns mean to me

The investment industry generally offers a clear product – compliant financial return. The product has no understanding of the social and environmental impact of that investment activity.

This is because the governing idea of our financial system is that investment managers have outsourced social and environmental responsibility to government, whose job is to regulate markets to prevent harm. The job of the investment industry is to create prosperity by making money, within the law. The social and environmental consequences are someone else’s job.

But the data shows that this idea has failed. Experience has shown it simply is not possible for regulators to stay ahead of the ingenuity of the investment industry. Investment activity can act perfectly properly to drive prosperity, whilst unintentionally driving disastrous consequences for society and the planet without intervention from the regulator.

Given the gravity of the social and environmental situation (data), it is now up to investors to take that social and environmental responsibility back inhouse.

Doing this results in a completely different quality of return. Whilst the financial return remains core, added to it is the social and environmental impact created in the course of making that financial return. This is a completely different quality of return.

Having an understanding of the quality of the return needs to become the new normal for investment. Investors are increasingly looking for a good quality financial return. Having a negative impact, or not knowing the impact, will be considered a poor quality return.

Snowball’s role is to demonstrate that a good quality return is possible for everyone, and to show what it looks like. We hope and believe that, in the future, the quality of returns will be a key consideration for investors.

Why I co-founded Snowball

I came together with a group of mission aligned investors, as we wanted to understand our impact. We talked to advisors but kept hearing the same inadequate answer: ‘You can do philanthropy or mainstream investments which screen out sin stocks’. This missed the point that all investment has an impact.

As an entrepreneur, I could see a world of investment-ready profitable solutions that tackle the problems facing our society and natural world. And it’s clear there is a groundswell of people who want their money invested in something which shapes a better future.

If impact investment stays a niche activity, it will remain unsuitable for pensions. There is need - and demand – for a comprehensive solution that spreads risk and generates healthy returns, so that people don’t have to choose between their financial future and the future of the planet.

Snowball’s team of impact and investment specialists allow investors to balance impact and returns. Our mission is to scale this solution so people can choose measurable impact and good returns for their savings. And in the process influence the way the investment industry works.

I'd love to hear what you think. You can reach me by emailing the Snowball team on hello@snowball.im