Eeww Finance?
It always seems too good to be true. To trade $10 for $12. To be given a free meal. There must be a catch. And yes there is, that is the risk.
I’ve never been a big fan of finance. Coming from a modest family, playing with money – the risk is too big to lose it. Especially with 2008 financial crisis, to disguise risk and be fooled by it is simply too easy. But there is one thing in finance that I find meaningful – loans to sustainable startups.
Last Friday, I attended the Chasing Sustainability Conference at the Liu Institute for Global Issues. The first speaker was David Berge, Senior Vice President of Community Investment at Vancity. He spoke of Vancity’s values of the triple bottom line and investing in businesses that were sustainable. These values reflected in which business startups Vancity decided to lend money to and the causes that Vancity gave grants to. David described how a lot of the time sustainable practices of a company were coincidentally also best management practices. To be sustainable is to build a business for multiple generations – for example, not depleting our natural resources so that future generations can enjoy them also – and not just keeping one generation’s of profits in mind. To treat employees well by letting them spend a portion of their paid time working on a project them find meaningful is building positive organizational culture and fostering employee vitality.
Finance is the most powerful when it meets values. For Vancity to invest exclusively in startups that are sustainable (and coincidentally well-managed!) builds capacity for the community. As a young woman looking to be an entrepreneur of a triple bottom line social enterprise, I thank Vancity and any other financial institution with similar business goals and values.
Update: November 30, 2010
I recently ran into an article in Maclean’s titled “Microfinance Meltdown” leading me to rethink this blog post. This article reports on certain microfinance players in developing countries who have been charging high interest rates on their loans. These rates reach up to 30%. It makes me extremely sad and worried to hear that such an effective means of promoting sustainable growth can be dirtied by unethical firms.