Investing to Make the World a Better Place
Sunday, July 31, 2011
How does the way you spend your money make you feel? An article published in the April 2011 issue of the Journal of Consumer Psychology reported that the way money is spent does have an effect on human happiness. When money is spent to help others, such as supporting a local charity, consistent positive feelings are produced.
The New York Times recently reported that the current state of the global economy has brought about a new outlook on commerce and entrepreneurship. Social entrepreneurs combine the idea of a nonprofit organization with that of a profit-raising business, to provide a service that seeks to make the world a better place. The mission of the business should be just as important as the profits earned. Ignia Fund, Leapfrog Investments, and MicroVest, all three of which are social-impact funds, have raised over $100 million during the last two years.
Freeset is a fair trade business that employs women in Sonagacchi, one of the most notorious sex districts in Kolkata, India. Women who would otherwise be victims of the sex-slave industry are instead employed by factories where they craft organic cotton t-shirts and jute bags. These bags have been sold at the Tree of Life Bookstore located here in Marion.
The Potter's House sells free trade goods as well. Products are made by individuals in third-world countries, who are then able to feed their families from the revenue raised. Products are sold alongside South Bend Chocolates and Pierre's ice cream. The Potter's House also contributes 10 percent of the proceeds to organizations within the Grant County community that help to feed hungry families here.
TOMS shoes is also setting out to make the world a better place. For every pair of shoes sold, another pair goes to a child who would otherwise go barefoot. Blake Mycoski, the founder of TOMS, took a trip to Argentina and discovered that many of the children there had no shoes. After the initial start of the company, Mycoski went back to Argentina and gave away 10,000 pairs.
"I get the sense that the recession actually has resulted in more people taking interest in investing in companies that are doing the right thing right from the start," said Wes Selke, who works for Good Capital in San Francisco. People flock to seek employment at nonprofit organizations, such as United Way or the National Association of Mutual Insurance Companies, because they want to make a difference with what they do for a living. Maybe we can boost the American economy while we also improve the overall condition of our lives.