What does yoga have to do with investing? On the surface, it might seem the answer is “nothing.” When you think of yoga, you might imagine a wiry, flexible person who has contorted themselves into a pretzel, or maybe a sweaty, fit person in a hot yoga class. I certainly did. However, maintaining a “yoga practice” is not just about doing physical postures. The practice of yoga is a process of recognizing the connection between body, mind and spirit. At its core, yoga is a process of self-realization, a process through which one expands “awareness from a limited sense of Self to a sense of the eternal True Self,” according to Patanjali, the author of one of the oldest complete texts on yoga. It’s through this connection to the self that we experience a connection to others. Stated another way, through this process we begin to see how our individual actions have an impact on the broader world (or through the lens of finance, the broader economy).
Sustainable investing is a similar acknowledgement. It’s recognizing that we are part of a larger community and that our actions reverberate throughout the world. It’s a process that recognizes the way we allocate our capital will have an impact beyond what we can see and calculate today. For example: What happens to productivity when a company takes the time to ensure its employees work in a safe, clean environment and are given opportunities for personal growth? What happens when a company spends time thinking about corporate governance issues? How do these efforts improve their relationships with their employees and their investors? For management, this might mean facing the truth that your core business is in a stage of decline and it is time to either reinvent yourself or return the capital.
To paraphrase one of my favorite authors, Stephen Cope: The original yogis were scientists. They were focused on how human beings function in the world. What they found is that human existence is filled with suffering. Rather than focus on how or why we suffer, these yogis focused on how we react to suffering. They saw how we grasp for the positive and push away the negative. It’s human nature. The problem is, as we’ve found out, life isn’t all Norman Rockwell. Someone has to clean up after the Thanksgiving meal; someone has to take responsibility. We all want to see a return on our investment, and we don’t want to have to deal with collateral damage like pollution or unhappy employees who have to work two jobs just to make ends meet. But you can’t separate the two. By looking at the investment holistically, one can better understand the good with the bad. Yoga is just that: it’s about acknowledging both sides and finding the space in between.
Becoming aware of (or awakening to) our habits gives us a chance to let go a little and see things from a different perspective. When we stay clenched in our familiar protective pattern, we reduce the possibility of finding an alternative approach. Sustainable finance is about finding a new perspective. It’s not about burying the byproduct in the ground or squeezing your employees’ compensation for quarterly profit. However, sustainable finance, like yoga, is a process, not an end in and of itself. It’s a process of acknowledging both the good and the bad in an investment and finding the space in between. There’s a saying in yoga: “It’s called a practice, not a perfect.” Each day you roll out your mat and learn a little more. The learning never ends; the practice continues.
David Dusenbury is a Senior Vice President and Sector Specialist focusing on Insurance and Miscellaneous Financials for DGHM & Co. Prior to that, he was an Equity Research Analyst at Dionis Management, Credit Suisse First Boston, and Salomon Brothers.