HOW DID YOU START YOUR CAREER?
I was always motivated to do social justice work. I started my career in law, working at a big law firm in financial service litigations, mainly to pay off my student debt. In the middle of my career, I started developing a Native American law practice at my firm, because I noticed how tribal nations were being taken advance of in various finance dealing actors the country.
At the same time, I became acquainted with people in the social investing space. One of the litigations I did was with a fund for an institution that had started to look at ESG and how it aligned with their fiduciary duty. Having a better understanding of fiduciary duty and creating change on behalf of tribes as an institutional actor this truly became the backbone of my work. Ultimately, it brought me to philanthropy, because this research and advocacy has to be resourced.
WHAT IS THE ROLE OF PHILANTHROPIES AS INSTITUTIONAL INVESTORS?
Philanthropies have a huge role to play in both sustaining this type of work and also as an institutional investor. Very few philanthopies activate their own endowments to ensure they are seeing the type of change that they claim they want to see. Pension funds have been doing this for a long time with varying degrees of success.
Impact investing is different than shareholder advocacy. Philanthropies are very open to having a different lens on returns and risk and putting endowment assets at risk, but there is a capacity issue for philanthropies to understand stakeholder advocacy. It is partially an educational problem, but also comes from asset managers not being proactive with their clients about voting their shares. Most of the managers are not asking the clients' values, so that the shares can be voted in line with their values, and vice versa, clients are not asking managers about their values to get to know more about voting.
My hope is philanthropy will do better shareholder actions and work with their manager to achieve impact through their portfolio, all the while being aligned with their values.
With shareholder advocacy work, you are protecting the value of your shares, so it should be part of your fiduciary duty.
HOW IS THE CHRISTENSEN FUND ACTIVATING THEIR ENDOWMENT?
We aim to build the sovereignty of indigenous people so both our values and monetary value serve that purpose well. We reconstructed the portfolio to align with our values, meaning that the risk/impact ratios are adjusted accordingly, while achieving the returns needed. It is difficult, but it is possible.
DO YOU HAVE ANY ADVICE FOR INVESTORS WITH A SOCIAL MANDATE?
Finance is a numbers game, so there is a need to quantify and add items in a number box. Setting KPIs is often looking backwards instead of looking forward and focusing on proper human rights due diligence.
There is one famous quote about it: "I know it when I see it” and if investors were truly interested in due diligence in social issues, they would be listening to communities. Taking the example of the Dakota Access Pipeline, the communities around were very much against the project, and that was not a secret to anyone. Ultimately, there is a disconnect between the large Limited Partners (LPs) who will say that their business is separate from ESG, since they already have one ESG fund. I do hope that this is breaking down a bit, otherwise it is quite ineffective.
CAN YOU SHARE YOUR WORK WITH INVESTORS IN THE DAKOTA ACCESS PIPELINE?
It is important to describe to the outside that tribes and reservations in the USA are not exempt from treaty land. Before Energy Transfer Partners started the pipeline project, the oil was taken and brought to the refinery by trucks or rail, however a pipeline would be more efficient and safer. Originally the pipeline was designed to cross the Missouri river in the North, but this route was rejected as there were high chances for the pipeline to leak over the river. It was therefore re-routed it to be 1500 feet from the Standing Rock Sioux Tribe territory border. The company mentioned that since it was not on the tribe's land directly, the tribe did not have any legal jurisdiction say in the project. The pipeline was built, the tribes sued, and it led to massive uprisings.
I was called upon by the tribe leadership to support the advocacy of this project, and advocacy with the financial actors of the project. At the very minimum, there should have been a consultation between the the tribes and the financial stakeholders. In fact, all the legal and international mechanisms had ruled in favor of the tribes, the higher court found that the tribes had the right to refuse the pipeline, but it was too late for an injunction relief as the pipeline was already built.
We had a great rate of success with the financial actors and pulled resources out of asset-owner partnerships. For some of the investors, it was a bit late, they had already experienced losses because the project had been delayed so much and they were receiving penalties.
When that work was complete, it was very clear that this was preventable. This case study is a very important lesson for investors, to connect with the local communities and that early intervention is crucial from a risk perspective. One of the outcomes developed was a list of considerations for investors seeking to implement best practices to solicit the free, prior and informed consent (FPIC) of indigenous peoples as to development or resources on and near their lands and territories.
WHAT ARE SOME OF THE MOST USED AND ABUSED CLICHÉS IN SUSTAINABLE FINANCE THAT BOTHER YOU?
I dislike the word sustainability. It's so broad. It can be understood in a lot of ways. Most importantly, I rarely see this contract being understood holistically. It's often understood as an environmental focus but we, as indigenous people, know that if we don’t have culture and language, we cannot be sustainable. The SDGs do a fair job at offering a holistic view of sustainability, but the finance world is not looking at them holistically.
Another word I struggle with is the concept of ‘technical understanding’. In my experience, the 'technical veil’ is often a dismissive and over-used phrase in human rights implementations.
