Dear Fellow Shareholders, 

Responsible investors know that the way you invest can make a difference that goes well beyond investing only in industries we feel supportive of; we make a difference by looking at the total impact of how we manage our overall portfolios. An important and often overlooked impact is the ability to support the fabric of a local society. Population wellness and happiness are strongly tied to the communities in which we live.

At Domini, we support institutions that are important to the health, safety, and support of its neighbors. Businesses that operate with amplified positive impact on their communities are often thought of as “anchor institutions.” At the core of their business, they serve people with the understanding that this will improve their business and its results. These entities not only provide jobs but often add value through health services, financial literacy, educational resources, counseling services, small business development, and economic development.

At Domini Impact Investments we have been reviewing the eco-system of communities and evaluating the components to keeping a location healthy. The benefits of many components are clear and plentiful. Public transit systems, libraries, hospitals, public schools, green spaces for recreation, and banks (as opposed to ATMs) represent some of the most obvious components. 

Realtor.com and Redfin found, in separate studies, that real estate prices command up to a whopping 32% more than equivalent opportunities not convenient to public transit. Some of this is driven by millennial preferences – studies show 63% of millennials prefer to live in a car-free or car-infrequent location, but much is driven simply by traditional commuter preference. What these figures argue is that public transit is not just a nice gift to people who cannot afford cars; it is valued highly by the affluent as well.

Hospitals matter and are disappearing from rural areas.  We now have a phrase for it, “hospital deserts.”  About 30 million Americans do not live within an hour’s travel of a trauma center, which means that accidental deaths are 50 percent higher in rural areas than urban ones.  This is not only a failure of a civilized nation; it is the ripping away of an important anchor to a community. Hospitals employ roughly seven million Americans, and in many places, they are the single largest employer in the region (our largest private corporate employer, Walmart, has approximately 1.5 million employees in the United States).  Thirteen states, including rural ones like Alaska and North Dakota along with densely populated ones like Massachusetts and Connecticut depend on hospitals as the number one source of jobs for their citizens. 

Public schools are perhaps our most beloved anchor institutions. Academic work indicates that a high-quality public-school system is the most influential aspect of housing costs. People want good schools, and good schools enrich a community. Public schools are also important sources of employment, currently employing approximately three and a half million teachers alone.

Green space also enhances value. One 2018 study shows that being within 100 meters of an urban green space increased real estate prices by roughly eight percent. America’s various parks and recreational properties generated $154 billion in economic activity in 2015 and generated over a million jobs. But no amount of economic value can adequately quantify the benefits to the quality of life that these facilities create.

While public transportation, many hospitals, public schools and parks are not in shareholders’ hands, most banks are. We at Domini recognize this is a different dynamic but also recognize the important role that financial institutions can play in keeping the other anchor institutions healthy.  Further, as roughly two million Americans work for commercial banks, we recognize the role they play in keeping jobs local and in funding local institutions.

These comments have focused on the economic benefits of only the very largest community anchors, but many smaller ones, such as our public libraries and little leagues in various sports also play a key role. The focus on financial or economic benefit is not to suggest that only money matters, but rather, we argue that the figures demonstrate that our nation is willing to pay highly for these institutions.  Our lives are enriched by them and we spend dearly to protect them.

In this annual report we review for you some of the findings from our study of the key role of anchor institutions.  We thank you for your interest in our work and for your continued support of the concept that one can invest for good. 

Carole Laible 

President

Amy Domini 

Founder and Chair