About five years ago, environmental, social and governance (ESG) investing was all the rage. It’s a strategy that considers how issues like climate change might affect investments in the future. But long before ESG was a concept adopted by Wall Street, there were smaller investors weighing environmental and social issues: Religious investors.
Sister Pat Daly, a Dominican nun from Caldwell, New Jersey, was a trailblazer among faith-based investors. Daly died in 2022, but for decades she was the executive director of the Tri-State Coalition for Responsible Investment, a group of religious orders that leveraged their collective shareholder power to push companies to make social and environmental changes. “We were not at all welcome,” Daly said in 2014, when accepting an award for her work in sustainable investing. “They did not like these nuns and priests and rabbis and ministers showing up at these annual meetings.”
But over time, she became friends with some of the very people she butted heads with in the boardroom. “Sister Pat would show up to deaths and births and marriages…of companies that she fought for 20 or 30 years,” said Tracey Rembert with the Interfaith Center on Corporate Responsibility, a coalition of faith-based and other socially-conscious investors. Today its members collectively own or manage more than $4 trillion in assets.
“She just went head to head with so many powerful CEOs,” Rembert said “You were literally in an auditorium and looking at a David and Goliath scene, where it is one person up at a microphone talking to huge sources of power in the United States, and saying, ‘This isn't good enough.’”.
Daly led the charge on pushing companies to act on climate change. She pressed huge corporations like GE, Ford and Exxon Mobil to take steps to address their environmental impact. In a 2016 interview, Daly credited the decades of work from faith-based investors for laying the groundwork for ESG investing. “I think the legacy is that we really have started the ESG movement,” she said. “We've set it in play, and it's taking off.”
By the early 2000s, Wall Street started caring about these issues, too, for a very different reason: The bottom line.
This is an excerpt from the latest season of How We Survive. Listen to the full episode here.
