One way the Fowler Center contributes to responsible management education at Weatherhead is through our regular Lunch & Learn series. On February 5th, we invited William Vogelgesang and Lynn Carpenter from Epoch Pi to discuss impact investing, B-Corps, and the purpose economy. With more than 50 years of investment banking experience between the two of them, they gave our students an in depth perspective on how impact investing works to promote profits as well as social purpose.
Conscious Capitalism is the idea that businesses can reach a higher purpose optimizing outcomes for shareholders as well as customers, workers, the surrounding community, and our planet (it is also the name of the book co-authored by our Advisory Board member Raj Sisodia). Exemplified by companies like Whole Foods and The Container Store, companies that consider all of their stakeholders in their pursuit of maximizing value can actually achieve better business outcomes that put them ahead of their competition.
Next the team discussed Public Benefit Corporations and how the recently formed legal status for companies can help them maintain alignment from their investors when pursuing a higher purpose. Traditional public companies can actually be sued by their investors for not maximizing stock price. Public Benefit Corporation status, available in some states, but not Ohio, gives legal protection to directors and officers to consider the interests of all stakeholders, not just shareholders when making decisions.
Though Public Benefit Corporation status is not yet available to companies incorporated in Ohio, companies are able to become certified B-Corps by completing a rigorous assessment from the certifying body, B-Lab. Epoch Pi, one of Cleveland’s few B-Corps, uses the principles of impact investing to pursue similar outcomes for their clients. Like traditional investment banks, Epoch Pi helps clients pursue mergers and acquisitions to help grow and strengthen their companies. The difference is that Epoch Pi clients have a conscious capitalist mindset and are looking for investors who seek both social and financial returns. Like their clients, the Principles at Epoch Pi want to make a positive difference in the world and started Epoch Pi to help ensure the purpose economy fulfills its greatest potential.
At the end of the session, we had a rousing discussion about the potential for all three concepts and how they might apply in their own personal and professional lives and investment decisions.
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Weatherhead School of Management at Case Western Reserve University cultivates creativity, innovation, and purpose-driven leadership to design a better world.