By Mark Kriss, Peter Kriss and Jesse Kriss
Family businesses come with a special sense of responsibility and commitment to the long-term.
But beyond driving our commitment to exceptional service, this perspective also forms the very foundation of our investment strategy: how can we leverage the deep connections between financial markets and the physical world to do what’s best for both our clients and the planet, now and in the future?
When our family (father Mark and sons Peter and Jesse) became increasingly concerned about climate change around six years ago, we decided to do something about it. What resulted was the world’s first automated personal divestment platform, and in the process, great joy from working together as a team to build a solution that could make a meaningful difference.
Macroclimate is a new kind of investment company: one that uses financial science, expert opinions of climate scientists, and state-of-the-art automation technology to help you invest better — in an environmentally-responsible way.
As we launch this revolutionary new platform, we’d like to share more about who we are and how we arrived at our mission to reduce climate risk through geofinancial engineering — the leveraging of financial markets to positively impact the global climate.
It started with a Vision.
Knowing we wanted to make a difference was the first step, but we quickly realized that the information we needed didn’t yet exist. With a combined skillset incorporating experimental and behavioral economics (Peter), information visualization and user experience (Jesse), and communication research and financial technology (Mark), we sought out scientific answers.
Tapping into new research methodologies for gauging expert opinion on complex and uncertain issues, we created Vision Prize. For three years, in collaboration with the UK’s Institute of Physics (IOP Publishing) and researchers at Carnegie Mellon University, we worked with an expert panel of 340 climate scientists to determine the best — and most scalable — ways to help investors and others improve climate outcomes.
Their conclusion? The single most effective way for investments to reduce the risks of catastrophic climate change is to focus on eliminating coal-fired power plants.
A practical, actionable and specific solution.
The problem was that the financial tools to do that didn’t exist — and were certainly not accessible to everyday investors. But with the launch of Macroclimate, that’s changed. We’ve developed a practical response to climate change that allows individuals to have an impact — and we don’t stop with coal.
Macroclimate is unique in the investment world in that we’ve oriented our whole business and practice around climate and climate risk. We believe that, by accelerating the fossil fuel divestment movement, we can not only measurably improve climate outcomes; we can improve financial outcomes as well. And there are now more than $90 million in assets under management aligned with the Macroclimate low-carbon strategy.
Powered by Dimensional.
Of course, even the best technology-based investment solutions are only as good as the funds that underlie them. That’s where Dimensional comes in. Dimensional manages over $400 billion in assets, including two funds specifically formulated – with our input – to take into account climate risk and divestment. With four Nobel Laureates serving as directors and resident scientists, the Dimensional funds we use have outperformed the market by focusing on “dimensions” (or “factors”) with higher expected returns, while continuing to limit risk through diversification.
How it works.
Over the most recent five-year period, global clean energy has significantly outperformed fossil fuels. And because there is increasing pressure on the fossil fuel industry as nations move toward meeting the 2015 Paris agreement, among other factors, long-term investors are more likely to see upside than downside if they overweight low-carbon investments and avoid risky fossil fuels.
Using state-of-the-art technology — and leveraging the latest behavioral decision research — Macroclimate is the world’s first-ever automated investment service for divestors anywhere in the US.
Macroclimate increases your investments in those companies that are viable alternatives to the worst actors, while excluding more than 99% of the Carbon Underground 200 (owners of fossil fuel reserves) and the Macroclimate 50 (owners of coal-fired power plants in developed markets, China and India).
Make a difference today.
We are proud to say that the nonprofit project Divest Invest Individual just called Macroclimate one of the 5 Ways Your Personal Investments Can Help Solve Climate Change.
Getting started is easy. The first step is determining how exposed your current investment portfolio is to climate risk. Our free CarbonScan® tool lets you enter your current investment allocation, and returns a portfolio analysis that tells you how your investments stack up.
Once you complete your CarbonScan®, Macroclimate will create the optimum climate-savvy portfolio for you — one that factors in your age, tolerance for risk, investment goals, investment time horizon, and expected cash needs.
If you’re reading this, chances are you share our family’s concerns about the future of this planet. And you’ve made up your mind to do something about it. We’re extremely proud of what we’ve created with Macroclimate, and we look forward to helping you invest in both your own financial future as well as a better world for all of our kids and grandkids.
Follow us for news about Macroclimate, and for the latest insights and research on divesting — and investing — for future generations.