In one of the most iconic rooms of New York, Cornerstone Capital Group joined together with the Rockefeller Brothers Fund, Astia Angels, XMS Capital Partners, The Clinton Global Initiative and ATCO Realty, to host an event this month to consider what it takes to create the world’s next wave of iconic entities…businesses and leaders who will have a lasting legacy. “Business Model Innovation” and “Impact at Scale” were the order of the evening on April 2nd where entrepreneurs, innovators and financiers gathered at the New York Yacht Club’s “Model Room” to engage in wide-ranging discussions on sustainable and impact investing and the potential for the private sector to drive system-level change.
In his welcoming remarks, Richard Parsons of Providence Equity Partners pointed out that investors have become more sophisticated about the interconnectedness of the world and the notion of sustainability. For many, simply driving for returns isn’t enough; they also strive to move people, the economy and the world in a more positive direction. “With our investing, we take a point of view. We want returns, good returns, but we also want to see a ‘second bottom line’; we want to see that we are making a positive difference with our invested dollars.” On the same note, he praised the commitment and expertise of Cornerstone Capital for combining “the discipline from the analog world in which we grew up and the sensibility of the world into which we are going.”
As for ways to effect positive change in the world, Justin Rockefeller of the Rockefeller Brothers Fund suggested that as people and institutions what we do with our money “has moral consequences,” and that we should consider ways to deploy the variety of tools at our disposal. These may include: time, networks, connections, government lobbying, the capital market, and even our day jobs. And sometimes, he suggested, it is simply the insistence to “ask annoying questions.” By leveraging these tools and applying them to certain acupunctural points – such as investing in businesses that create social and environmental impact – we can drive measurable societal change.
On the need to “ask annoying questions,” Erika Karp, Founder and CEO of Cornerstone Capital, and former Head of Global Sector Research at UBS Investment Bank, concurred with Rockefeller. She added that it is these “annoying questions” that possess the power to “challenge the status quo and bring greater transparency and collaboration.”
Greater disruptive power must come from business model innovation. To illustrate that potential, Cornerstone showcased rapid-fire presentations from four ambitious “Impact Entrepreneurs:”
- Guy Halfteck, Founder and CEO of Knack, showed how the digital games his company develops can uncover the talents, traits, skills and strengths of a player. Knack’s algorithms help identify a person’s innate potential based on the way they solve problems and play these games, which are accessible via handheld apps or a desktop. For young people who lack access to education and sophisticated technology in particular, Knack’s ability to unlock previously hidden human potential offers a path to economic empowerment.
- Julie Lerner, CEO of PanXchange, explained how her company’s user-friendly, web-based commodities negotiation and trading platform provides true price information where supply
- meets demand. Built by traders, for traders, PanXchange’s solution improves price transparency, liquidity and market efficiency for physical market players.
- Mike Brady, President and CEO of Greyston, adopts an “open hiring policy” at his company’s bakery operation in Yonkers, NY, which is a key supplier to Unilever’s Ben & Jerry’s unit. In other words, he’ll hire individuals with a criminal record, or no prior work experience, or education, and teach them the skills they can use to rebuild their lives. By eliminating the barriers to entering the labor market, Greyston serves as a force for personal transformation and community economic renewal while baking high-quality products.
- Ron Gonen, Co-founder and CEO of Closed Loop Fund, showed how the Fund spurs innovation and progress by catalyzing investment in recycling infrastructure and programs. With the interest-free and below-market-rate loans the Fund provides, municipalities and private companies can support and scale their recycling initiatives, and realize savings in waste management.
In her closing words, Karp underscored that though challenging, to achieve impact at scale is paramount. “It’s not hundreds of millions, or billions, but trillions of dollars that we need to move, if we are to address the challenges of climate change, health care, infrastructure, education and income inequality, globally.” Equally vital is the need for collaboration and capital. “Because a little bit of catalytic capital can drive enormous change if we continue to learn and to share, collaborate, communicate and articulate how we can do capitalism right.”
View the event photo gallery here.
Andy Zheng is a Research Associate at Cornerstone Capital Group