Impact investing. Environmental, Social, and Governance (ESG) investing. Values-based investing. These terms are popular across both investment firms and the media, but there’s a gap between those who believe responsible investing is important and those who actually align their portfolios with their values. And that gap is pronounced. According to a 2022 NerdWallet survey, while a whopping two-thirds of investors see the importance of impact investing, fewer than one-fourth of investors invest this way. 

Why? It could be because the majority of investors aren’t sure how to invest in their values. With the right tools and platforms in place, wealth advisors can enable their clients to align their values with their portfolios, helping them generate a financial return while playing a role in financing the transition to a more sustainable economy. 

Beacon Pointe Advisors (Beacon Pointe), a wealth advisory firm that serves over 13,000 individuals, families, and institutions, wanted to lean on technology to help their clients become a part of the sustainable investment movement. To do this, they partnered with Ethic.

Every client is unique. Beacon Pointe was hoping to crack the code into understanding their prospects’ and clients' most important values. The firm created a Social Policy Statement, a two-page printed document in which clients simply had to select which categories of companies they believed were most important — examples of categories included companies with comprehensive environmental policies and companies with diverse board leadership. 

But the documents did not reveal clients’ values or show how they could make a personal impact. With limited information on their clients’ goals, wealth managers found it difficult to customize portfolios. And since the Social Policy Statement was just a piece of paper, wealth managers weren’t able to easily digitize the process of collecting metrics that demonstrated to clients the impact their portfolios were making.

Beacon Pointe wanted a more robust process for learning about client values — and they needed industry-disrupting technology to help make it happen.

In 2020, Ethic provided Beacon Pointe with their Values Mapping Exercise (VME), an interactive digital tool that allowed clients to express their values more clearly, granting them access to a clear framework for mapping their values and easily sharing that information with their wealth managers. LeEric Daye, principal and senior wealth advisor at Beacon Pointe’s Boston Office, told Ethic that clients enjoyed the active role the VME gave them in decision-making much more than the experience of filling out a piece of paper. He said, “The VME keeps clients engaged.” 

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The VME also provided much greater detail on clients’ values. Clients could now define their commitments across Ethic’s 19 Sustainability Pillars, a holistic system reflecting the complex issues affecting our world. Issues reflected in these pillars include women’s rights, LGBTQ+ justice, racial justice, climate change, animal rights, and education. 

Using data from the VME and Ethic’s platform, an interactive portal for seeking impact, Beacon Pointe’s wealth managers could propose a customized equity portfolio for each client that aligned with their values. 

Further, Daye said that when clients had questions about specific causes and companies, “Ethic gave us the information, education, and resources to confidently go talk to clients.” Best of all, after choosing their portfolios, Beacon Pointe’s clients could use Ethic’s platform to track the positive impact of their investments.

Ethic helped Beacon Pointe efficiently and effectively learn about each client’s values. Instead of asking clients to simply check boxes, Beacon Pointe could use Ethic’s VME to hear directly from clients which causes were most important to them — in a matter of minutes.

Ethic helped Beacon Pointe customize portfolios for clients at scale and show clients their positive impact. Since starting to use the VME and Ethic’s platform, Beacon Pointe’s clients can not only “align their values and their portfolios but are also able to track how much good they've done. They love seeing all the metrics within the portal,” said Melisa Dobraca, a senior associate wealth advisor at Beacon Pointe’s Boston office. 

Ethic helped Beacon Pointe build stronger, more authentic relationships with clients and prospects. “Ethic’s a differentiator,” said Daye, noting how Beacon Pointe’s “clients are excited to go through the VME process because it’s so different from what they’ve seen.” Dobraca agreed:  “The VME was a slam-dunk for us, and it’s helped us grow our business by developing very deep relationships with our clients.”