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General Terminology
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Corporate Social Responsibility (CSR)
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The integration of business operations and values whereby the interests of all stakeholders including customers, employees, investors, and the environment are reflected in the company's policies and actions.
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Double Bottom Line
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Refers to a balance between a company's social and financial return.
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Social Venture Capital
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Funds raised to support economic ventures with a focus or mission involving the improvement of society.
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Stakeholder
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Anyone who is affected by or who has an affect on an organization.
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Triple Bottom Line
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Refers to a balance between a company's social, environmental, and financial return.
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Affordable Housing Initiatives
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community lending used to build or rehabilitate housing for low-income families. Loans are usually accompanied by supportive programs helping individuals secure and repay mortgages.
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Community Banks
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For-profit, insured banks or savings institutions that target low-income people or others who lack adequate access to financial services. Given the typically low to moderate-income customer base of development banks, they often depend on additional deposits from outside of the community to fund their lending activity.
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Community Development
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Lending supports non-profits and cooperatives that are working directly with disadvantaged populations and communities to develop enterprises that provide core social resources, such as health services and daycare centers.
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Community Development Financial Institution (CDFI)
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Community banks, credit unions, loan funds, and microcredit institutions.
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Community Development Loan Fund (CDLF)
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A non-profit organization providing loans to underserved communities at below market rates for affordable housing, small businesses, and community facilities.
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Community Investing
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Investment programs, which support development initiatives in economically challenged communities through community-based financial institutions such as development banks, loan funds, and community credit unions.
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Cooperative Lending
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A group of microentrepreneurs form a cooperative whereby the group disburses loans to members and each member has ownership for the ventures.
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Informal Sector
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Non-registered, but legal enterprises or under-the-table businesses such as street vendors and babysitters.
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Microcredit
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Small, low interest loans to low-income entrepreneurs who have little or no collateral.
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Microfinance Institutions
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Organizations that provide small amounts of capital, often as little as $50 in developing countries, to people with little or no collateral so they can avoid usurious rates. Also gaining recognition in U.S. communities as well, although micro-loan amounts are considerably higher there.
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Peer Lending Groups
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A group of microentrepreneurs who receive formal loans typically through an intermediary such as a non-profit organization. Group accountability ensures successful loan repayment and members gain access to credit.
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Revolving Loan Fund
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Within a group of microentrepreneurs, a loan is made and must be paid back in full before a second loan is granted to another member of the group. In some cases group members will provide the funds rather than an outside funding source.
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Small Business Development
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This category of lending assists low-income people in disadvantaged communities to start or increase the scope of their own businesses by providing loans generally over $25,000.
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Social Investing
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The act of making investment decisions to achieve social as well as a financial return.
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Corporate Governance
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The balance of power within corporations that determines who controls company policy among the Board of Directors, corporate executives, and shareholders, and often challenged by the latter through shareholder activism.
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Divestment
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Discontinuing investment in a corporation because of social concerns.
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Proxy Ballot
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Used in voting on shareholder resolutions. All proxies not submitted are considered in accordance with management's recommendations.
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Shareholder Activism
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Investor efforts to submit and vote proxy resolutions as a means of influencing company behavior.
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Shareholder Resolutions
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Method by which stakeholders attempt to change corporate policies and practices.
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Affirmative Screening
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The act of investing in companies with values aligned with your own. Examples include investments in companies with good minority hiring records, good environmental records, or good community relations.
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Best of Class
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A positive approach to screening employed by some mutual funds and money managers, which includes the social and environmental leaders among each industry, even those with many challenges such as the oil industry.
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Child Labor
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Employment of children, generally under the age of 15 or below the compulsory schooling age, often under hazardous or harmful working conditions and at the cost of the children's physical, educational, and psychological development.
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Exclusionary (negative) Screen
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An ethical criteria that may disqualify companies for consideration of investment.
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Index
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A means of measuring the performance of a financial market or a sector of a market by calculating the prices of its constituents.
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Prospectus
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A document that contains complete information detailing the financial condition of a fund, including management fees and expenses.
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Screening
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The inclusion or exclusion of corporate securities in investment portfolios.
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Social Auditing
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The process whereby an organization can account for its social performance, report on and improve their performance. It assesses the social impact and ethical behavior of an organization in relation to its aims and those of its stakeholders.
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Sweatshops
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Production factories often marked by low wages, inadequate working conditions, overcrowding, poor health conditions, and long hours.
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Vendor Standards
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Workplace and human rights standards employed by corporations to assure that their products provided by supplier factories overseas are not tainted by sweatshop conditions, child labor, or other labor abuses.
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