Why Social Investing Is So Much More Than Simply ESG

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In this episode, Rianka sits down with Rachel Robasciotti, founder and CEO of Adasina Social Capital, to talk about her social investing approach and discuss in depth why gender, racial, and social/economic diversity is so critical to financial services.

Adasina is a firm that envisions a world where the most influential financial systems are attuned to, and act upon, the needs of the most vulnerable communities and the planet.

It is proud to be majority-owned and operated by women, people of color, and members of the LGBTQ+ community, a diverse team that reflects the impacted communities for which we seek justice.

This episode dives deep into investing strategy and how Rachel’s upbringing has driven her passion for the intersectional work of investing and social justice.

Rachel had graduated high school by age 15, and when she was just 25 she founded Robasciotti & Philipson, a firm dedicated to transforming wealth into a tool that supports the well-being of people and the planet.

After a few years, Rachel and her partner started to build an investment strategy based around ESG that took off and grew within her firm. But, now she had both a wealth management firm and an investment management firm. That became a conflict of interest.

Shortly thereafter, the firm merged with Abacus, and spun off into Adasina Social Capital, which she leads today.

Rianka and Rachel discuss in depth how gender, racial, and social/economic diversity is so critical to financial services. Financial advisors/planners need to know where their expertise starts and stops, and when to tap other experts.

Rachel shares the nuances behind their social investing approach which goes beyond ESG and looks clearly at the influence the financial market has that extends beyond an investors’ portfolio. Her clients were interested, as were financial advisors.

So in 2020, they launched the Adasina Social Justice All Cap Global ETF, to make what they were doing available not just to their clients, but also advisors who wanted to leverage this innovative approach.

Rachel shares how social justice movements are giving wealth managers early indicators of real material risk in markets, and talks about their expense ratio for these types of funds (89 basis points).

As more women and people of color start to pay attention to investing they will naturally continue to question the old fashioned extractive approach. This is a good thing. All financial investments should have an impact, we want to be on the right side of that.

The pair finally discussed the Due Diligence 2.0 Commitment, an effort to transform due diligence processes in the industry. “Traditional due-diligence and risk-assessment frameworks in the asset management industry have led to a system in which white, male asset managers control 98.7% of the investment industry’s $69 trillion in assets under management.”

What You’ll Learn:

How social justice movements are becoming early indicators of material risk in the markets
How the new generation of investors are considering their portfolio growth
How systemic change can greatly impact the financial services