Market Perspectives
Zevin Asset Management
Q3 2024 Market Outlook

Maybe it really is different this time. A typical business cycle usually consists of an overheating economy followed by higher policy rates imposed by central banks. This eventually leads to a slowing economy, and in 6 out of the last 7 monetary tightening episodes in the U.S since 1970, the economy has fallen into recession. Higher lending rates slow consumption, leading to layoffs, which further slows consumption and more layoffs, and so on. However, this cycle has been different so far. When the Fed began raising interest rates in 2022 to fight inflation, the personal consumption response was much more muted than usual, thanks to previous emergency pandemic stimulus. The U.S. economy has slowed somewhat in response to tighter monetary policy, but employers have been mostly reluctant to implement significant layoffs with the fresh and painful memory of the 2020-2021 pandemic reopening when consumer demand rebounded sharply but employers had a hard time finding workers to satisfy demand. So-called “labor hoarding” has become a significant attribute of the current economic cycle, which has contributed to the relative strength in the labor market, consumption, and the economy in general.

Social Responsibility

Investors Applaud the FTC’s Ban of Non-Compete Agreements, Safeguarding the Rights of Low- and Middle-Income Workers

Zevin Asset Management and the Interfaith Center on Corporate Responsibility (ICCR)  today welcomed the Federal Trade Commission’s (FTC’s) passage of a ban on non-compete agreements (noncompetes), after having submitted a comment letter last year to the FTC, backed by investors representing $436B in assets, in support of the proposed ban back in April of 2023.

Unleashing Impact Through Gender Lens Investing

Gender lens investing offers investors a process for identifying and weighing issues pertaining to gender-based issues — pay equity, gender diversity, and career advancement, to name a few. We integrate these findings into our investment decision-making with the goal of mitigating risk, identifying opportunities, and creating positive social impact.

Gender equity, while an important aspect of Zevin Asset Management’s research and impact process, is a part rather than the sum of our approach. Given the overlap between the issues we work on in addition to gender equity, such as racial equity and climate change mitigation, we do not view these issues in isolation. Instead, we employ multiple lenses in our investment approach and look for intersectionality between these areas to help us better understand and address inequities in our systems and institutions.

Investing with a Racial Equity Lens

Zevin Asset Management was founded on the belief that active investors have an important role to play in advocating for social and environmental progress. Since our founding in 1997, we have widened our panorama of risk and opportunity by conducting research on corporate environmental, social, and governance-related impacts to inform our investment approach. Through active ownership, we encourage companies to adopt more sustainable business practices that we believe make sense in the long term. 

We describe racial equity investing as a lens applied to companies to identify and change inequitable policies, practices, and behaviors to advance meaningful racial and ethnic diversity, equity, and inclusion. We accomplish our work through research and stakeholder collaboration, shareholder engagements, submission of shareholder proposals, proxy voting, and public policy outreach and support.

Root Out Impact Washing in Your Portfolio

Time and time again, I am disappointed to see the actively blurred lines between environmental, social, and governance (ESG) investing, values-aligned investing, and impact. By conflating these concepts, investors who are intent on making a difference with their investments are often misled. Taken in by false promises of the positive change their investments can create, investors can be persuaded by impact washing to allocate assets to products or strategies that do not actively create change.

Investors Support FTC Proposal to Ban Noncompete Clauses

Zevin Asset Management and the Interfaith Center on Corporate Responsibility, on behalf of investors representing $436 billion in assets under management and in partnership with the American Economic Liberties Project, submitted a letter to the Federal Trade Commission (FTC) vocalizing our support of the FTC’s proposed ban on noncompete agreements.