My knee-jerk reaction is to screen investments by highest return so that I’ll have more to reinvest, but I’m not investing enough to see a significant return, so it’s not a main priority. (For me, this is more akin to putting some money in a high-yield savings account outside of my bank.) So instead of sorting by highest return, I’ve sorted by “women,” since my moral priority is to empower women in developing communities, many of whom endure atrocities that most of us in the U.S. can’t fathom.
I’ve learned a lot about the plight of women in developing communities by following the work of Nicholas Kristof, the New York Times columnist and Pulitzer-Prize-winning author. I wouldn’t be exaggerating if I said that his book Half the Sky: Turning Oppression into Opportunity for Women Worldwide, co-written with his award-winning journalist wife Sheryl WuDunn, was transformational. It described in gruesome detail stories of sex trafficking, mass rape, acid attacks, bride burnings and further oppression of women worldwide. But, it also offered solutions!
Kristof and Dunn point out that it’s no coincidence that countries stricken with poverty and chaos have the most uneducated girls and marginalized women. They advocate, as do many international development organizations, that the most effective way to fight global poverty and extremism is through education and economic empowerment of girls and women. I strongly agree, so here we are.
Choosing women narrowed my options to 10 investments that left me questioning whether I’d prefer to aid conflict survivors in Cote d’Ivoire, empower rural women in India, or reduce extreme poverty in Haiti, among other options. Again, there’s no way I could make a decision based on cause alone, so I’ve narrowed the search further by the practical consideration of repayment rate—one to three years—and then by region. My final decision is to support entrepreneurial women in Haiti, many of whom lost husbands and other family members in the earthquake and are the sole providers for their families. My investment—with a maturity date of April 30, 2014 and an interest rate of 2 percent — will support the work of Sèvis Finansye Fonkoze, Haiti’s largest microfinance institution (MFI). Fonkoze receives some of its financing from Oikocredit-USA, the issuer of this particular security on MicroPlace. Oikocredit loans to organizations in 69 countries, and has a solid reputation, having never defaulted on paying its investors.
(Check out this video to discover more about Fonkoze’s work.)
With my first investment nailed down, my next step is to pick a second one, to diversify my portfolio. The second round of decision-making is much easier, because I know precisely which project I want to support: California FreshWorks Fund, via the Calvert Foundation. Why the FreshWorks Fund? There are several reasons: 1) This project supports domestic low-income communities (it’s one of two domestic investments available on MicroPlace today, but I’m told that more are coming in the future), 2) it benefits people in my home state, 3) it’s designed to increase access to healthy food in under-served communities.
Where I live, I’m incredibly grateful to have access (on every corner!) to organic produce and dairy, free-range meat, nutritious prepared foods, etc. Shockingly, in the poorest neighborhoods in my own city of San Francisco there are “food deserts,” or communities that have no or limited access to fresh, healthy foods—only junk and fast food. This means they have higher rates of obesity, diabetes, heart disease, cancer and many other chronic illnesses than the people in my neighborhood. This is bad news on multiple levels and I feel that I must invest in the health of my community. The interest rate for my FreshWorks investment is 1 percent, with a maturity date of July 15, 2014.
Now that I’ve identified my top investment options, I need to devote some time to reading the prospectus for each in order to make a final, informed decision. A prospectus is a legal document that is filed with the SEC, containing very detailed information about an investment offering for sale to the public. I’m talkin’ 50 pages, people! Stay tuned for my next blog post to learn more about risk, due diligence and reading a prospectus.
image: ebayink via Flickr cc (some rights reserved)