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Hazel Henderson on investing.
What I call diversification is something quite different -- the strategy I try to use is a 'contrarian' strategy. I want to be invested in companies that are not in any of these indexes, maybe haven't even gone public and might never have done an IPO, because they don't want to have to deal with day-to-day evaluation by portfolio managers who don't deal with long-term risks.
The kind of companies that I am looking for are those that have better thermodynamic performance, in other words trying to reduce to a bare minimum the flow of energy and materials through their balance sheet. Even better are those I call in 'Building a Win-Win World' the "attention economy", where the content of GDP is dematerialising and going towards services. I don't mean the classic definition of financial services, since 90% of that is speculation, but I mean the kind of services where the concept is that, instead of everybody buying a car, a community can rent them. The idea is that people don't want to buy the material goods, they want to buy the service that the goods provide, so you can immensely reduce the material and energy flows through the economy.
The investments I look for are those in the solar-age, information-rich economy -- that kind of international diversification is very rare. What we have is a financial mono-culture, driven by GNP-measured economic growth, but I am confident that the whole climate debate is going to shift attention towards what real diversification might look like -- diversification towards an inherently less risky economy.
That's why I've been in the ground floor of the screening industry, which
is almost a financial services sector of its own. The Domini 400 Social
Index has outperformed the S&P 500 since 1990 and, the more realistic
the screens get and the more they are applied, the more confidence you
have in the investments you are making.