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GUEST ARTICLE: Building Bridges In Thinking About Impact Investing - Part 9

Benjamin Bingham, June 18, 2018

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In a series of articles, a prominent US figure in the impact investing space explores how to pull together disparate ways of thinking about the world to show how this model of managing money should be addressed.

This is the ninth instalment from author, Benjamin Bingham, CFP, founder and CEO, 3Sisters Sustainable Management. He is the author of Making Money Matter/Impact Investing to Change the World (www.makingmoneymatterbook.com). His previous essay in the series can be found here and an item introducing Ben can be seen here. As ever, the views of guest authors are not necessarily shared by the editors of this news service and we invite readers to respond. Email tom.burroughes@wealthbriefing.com

 

To close this Industry series on how to invest to achieve the 17 Sustainable Development Goals (SDG’s) by 2030, what better industry to focus on than Infrastructure? Infrastructure is hidden in the background but underlies everything. All the 17 goals can be moved forward dramatically with changes in infrastructure. And yet, like our own internal workings, it is the least visible and the least conscious area for most of us. We drink the water, flush the toilet, complain about the bumpy roads or the slow commute when we see “men working” signs, but we don’t think of what lies behind so much of our everyday lives.

This includes the inequities of infrastructure: accessibility to all that is good, exposure to all that is bad in the environment. At the same time, infrastructure holds the most promise for a better future and has become ripe for Public-Private-Partnerships (PPP’s). Green Bonds and Social Bonds are increasingly addressing the underlying decay or inadequacy of global infrastructure; but traditional large-scale investors are also taking a lead in high return projects that often have the advantage of being monopolies, with steady cash flows and built in inflation protection.

How do we define Infrastructure? Just as carbon provides the structure for every plant, delivering from cell to cell the nutrients taken up by the intelligent root system below the surface, the built world’s infrastructure supports all aspects of life, from access to clean water, affordable energy, utilities and waste management, to making institutions of education and the arts, museums, theaters and healthcare facilities accessible. 

To get anywhere, roads, rails, airports and docks are the essential infrastructure that connects us. Imagine the massive infrastructure that delivers water to your tap or drinking fountain. Much of it is jerry-rigged like a massive Rube Goldberg junk sculpture in the subterranean depths, starting, perhaps from a pristine spring or mountain stream down into lakes that we might not trust to drink from on a camping trip. Then it flows down into a tangle of ever smaller pipes of corrugated steel to lead, copper and plastic, finally filtered and infused with stuff we would likely refuse if offered on a menu: “water, disinfected with chlorine and fluoride waste added.” No wonder we prefer not to think about it.

Finally, infrastructure must include the even less visible wiring of a wireless world: the limits of bandwidth.

Loren Eisley startled me in my 20’s when he suggested in the Immense Journey (1957) that our growing lack of understanding of the technology we use everyday threatens our continuing evolution. For investors in infrastructure the challenge is not only to understand what is, but to look beyond what is to what might be. Alice Mann in her recent release: Future First  (https://www.amazon.com/Future-First-Successful-Innovation-Challenges/dp/1783537639), calls this an essential mindset for leaders to succeed in business, but, more importantly, for the planet to survive and even thrive.  

Cities will need to be disassembled and reassembled in new ways, and new resilient cities will need to be built on higher land with new forms of transportation, green roofs, living walls and parkland serving to diffuse heavy rains, while surrounding wetlands will manage effluents. Increased leisure, due to AI and robotics will be accommodated with extensive access to natural and man-made experiences, not only for the rich, but for the health, enlightenment and well-being of the “masses.” The old paradigm of supremacy of any group over another needs to be seen as outdated. Infrastructure that supports equal access to knowledge, the arts and the beauty of nature can inspire a new sense of community, dampening down rigid polarities and biases.

It may sound like a utopian, brave new world, where the individual or the diversity of cultures may become homogenized; and this is a risk.  My hope is that, despite the flatness of information, rich variation will be central to the reimagining of infrastructure. Underlying the physical infrastructure there will need to be sound organizing principals that allow for diverse solutions appropriate to geography and culture.
100 years ago, at the end of World War I, a thought leader, by the name of Rudolf Steiner, was asked to provide guidelines for the rebuilding of Europe. The infrastructure of his thought design for a healthy Europe was based on our inherent three-foldness as thinking, feeling and willing human beings. Simple and profound, orientating society around this threefold reality is as appropriate today as it was then. Unfortunately, Wilson’s 14 Points were adopted instead, leading to territorial nationalism, corporate greed, endless war and nihilism. We need the “future first mindset” now more than ever, and the new infrastructure we build for the 17 SDG’s will not be walls of hatred but bridges of inclusion. The infrastructure itself can become the means to a positive future.

Here is John Bloom’s (Director of Organizational Culture at RSF Social Finance) recent take on Steiner’s organizational vision:

“At the core of Rudolf Steiner’s Threefold Commonwealth is the quality of human relationships. And those relationships have three key facets. One is our capacity to recognize each other as unique spiritually free human beings who showed up on earth at this time with a purpose. Two is to understand that we have to find a way to create social equity in how we create our agreements, including contracts, policies, laws, and governance. Third is to be awake enough to others’ material needs that we find a way to meet those needs not by working for ourselves but rather by working on their behalf.”

Creating the underlying infrastructure for a world that 1) empowers individuals to soar in their unique way, 2) provides and protects equal access to all that we have in common, and 3) facilitates the production, and distribution of essential goods and services, is an inspiring challenge. Investors in infrastructure would do well to use this three-pronged approach to make long term decisions and, along the way, question the short-term thinking that is prevalent today. As Stephen Covey (The 7 Habits of Highly Successful People) put it: “Start with the end in mind.”

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