Green America: Growing the Green Economy for People and the Planet

Co-op America Teams with Social(k) to Offer Socially Responsible Retirement Program to 3,500 Businesses
June 27, 2006

Social(k) is the first 401(k) provider to offer socially conscious investors the breadth and depth of investment options available in conventional retirement programs

Washington, DC – Co-op America, a national non-profit organization that promotes social justice and environmental sustainability, today announced it is teaming with Springfield, MA-based Social(k) to offer 3,500 Co-op America's Green Business Network™ members the new and most diverse 401(k) platform of socially responsible investment (SRI) funds available.

“Investors are increasingly turning to SRI funds because they actively promote responsible corporate conduct on important social and environmental issues such as climate change, as opposed to conventional funds which fail to take account of these issues. Recently Co-op America submitted over 38,000 signatures from concerned investors to American Funds, Fidelity and Vanguard asking them to take global warming seriously and vote their proxies in favor of climate change resolutions,” said Denise Hamler, Co-op Business Division Director. “None of the largest mutual fund companies in the U.S. vote their proxies in favor of climate change resolutions at companies they hold which is just one reason why many socially and environmentally responsible businesses want to offer their employees access to SRI funds. Social(k) offers these businesses an opportunity to provide a wide range of SRI investment options that take environmental and social concerns seriously.”

The Social(k) program is unique in that it includes more than 100 screened socially responsible funds, rather than the usual one or two. In addition, Social(k) offers over 600 traditional non-screened funds from 40 mutual fund companies to provide investors with greater choice when determining a retirement portfolio mix.

In keeping with its own mission of social responsibility, Social(k) offers web-based recordkeeping and administration via the Internet by East Windsor, New Jersey-based retirement administrator ExpertPlan, thus dramatically reducing the use of paper.
 
“A Social(k) retirement plan makes sense for the companies that are members of Co-op America’s Green Business Network™ as they already embrace social and environmental responsibility in all their day-to-day business practices,” says Social(k) Founder and President Robert Thomas. “Social(k) allows socially conscious retirement investors to profit while maintaining their principles.”

According to a January 2006 report by the Social Investment Forum, assets in socially screened mutual funds and other pooled products rose to $179 billion in 2005, an 18.5 percent increase over the $151 billion tracked in 2003. However, according to a 2002 Calvert/Harris Interactive® survey, less than one-third (32%) of employees have access to socially responsible funds as part of their retirement plans, while more than two-thirds (68%) of employees want the option invest in such funds. In addition, the survey showed that nearly three-quarters (74 percent) of employees who do not have SRI funds offered in their retirement plan would invest in them if they were offered.

Contrary to popular belief, socially screened portfolio performance generally matches and sometimes exceeds the returns of conventional portfolios. For example, over the past 15 years, since the inception of the Domini 400 Social Index on May 1, 1990, its annualized returns of 11.71% have beaten the S&P 500’s annualized returns of 11.05%
(www.kld.com/indexes/ds400index/performance.html).

SRI mutual funds use both positive and negative screens within the context of rigorous financial analysis. Positive screens may result in purchasing the stock of companies in the alternative energy sector, or companies that have a strong record on human rights and labor issues. Negative screens may exclude companies involved with alcohol, cigarettes, guns, or nuclear power, as well as those with egregious human or labor rights or environmental problems.

In September, managed mutual fund portfolios offered by Colorado Springs, CO-based First Affirmative Financial Network (FAFN) will be available as part of the Social(k) platform. These broadly diversified portfolios will allow participants to choose an investment option already allocated across 15-20 funds based on the amount of market risk they are willing to take. Thomas has already begun offering a comprehensive training program for investment advisers affiliated with FAFN, an independent investment advisory firm that supports a nationwide network of more than 120 investment professionals.

“We are excited to be able to offer Social(k)’s retirement planning services to socially conscious companies across the country,” said First Affirmative president Steve Schueth. “We are switching our company’s retirement plan to Social(k), and look forward to working with any company or organization that wants to do the same.”

Social(k) has been well received by businesses and organizations nationwide. Among its clients are some of the very companies whose fund programs are part of the Social(k) program, including Parnassus Investments and Women’s Equity Mutual Fund (San Francisco, CA), Winslow Management Company (Boston, MA), and FAFN.  
 
Other clients include Honest Tea (Bethesda, MD), the Environmental Health Coalition (San Diego, CA), the Organic Trade Association (Greenfield, MA), MoveOn.org (San Francisco, CA), Portland Energy Conservation, Inc. (Portland, OR), and Sustainable Design Consulting (Richmond, VA).

Social(k) has also been well-received by the financial adviser community—almost 300 financial advisors have registered with Social(k) in the first nine months that the program has been available. That number will likely climb in the wake of the First Affirmative training period, and after Thomas presents Social(k) to brokers and financial advisers at the Sept. 26-28, 2006 Progressive Asset Management conference in Pittsburgh, PA, the SRI in the Rockies conference in Colorado Springs, CO October 28-31, 2006 (www.SRIintheRockies.com), and the November 10-12 Green Festival in San Francisco (www.greenfestivals.org ).

In addition to the above, SRI mutual fund companies participating in, or soon being added to, the Social(k) platform include: Calvert Funds (Bethesda, MD), Citizens Funds and Pax World Funds (Portsmouth, NH), CRAFund Advisors (Weston, FL), Domini Social Investments (New York City, NY), MMA Praxis Mutual Funds (Goshen, IN), Portfolio 21 (Portland, OR), Sierra Club Mutual Funds (San Francisco, CA), and TIAA-CREF Mutual Funds (Boston, MA).

For more information, see www.socialk.com/coop.htm.

About Co-op America: Co-op America is a nonprofit membership organization founded in 1982 that harnesses economic power—the strength of consumers, investors, businesses, and the marketplace—to create a socially just and environmentally sustainable society. Co-op America’s membership alliance includes more than 75,000 consumers, investors and business leaders. www.greenamerica.org

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