Winning Over Mom-and-Pop Do-Gooders Is Aim of New Mutual Fund

(Bloomberg) -- A leading impact investment adviser to family offices, foundations and endowments is jumping into the mutual fund arena.

Cornerstone Capital Group is moving ahead with its first stock fund for individual investors with social and environmental goals. It will focus on companies in sectors including water, fintech, environmental and economic solutions, and global sustainable growth, according to a statement issued Tuesday.

“There’s a perception if you are a typical investor you can’t have social and environmental impact through your investments,” said Erika Karp, Cornerstone’s founder and chief executive. “What we’re doing is trying to get rid of that notion.”

Cornerstone is adding to its roster as impact investing has grown into a $502 billion market for investors that hope to do well and do good. Major asset managers including BlackRock Inc. and Fidelity Investments have moved into this arena with their own offerings.

The Cornerstone Capital Access Impact Fund (CCIIX) will be fossil fuel and tobacco free and will not invest in “controversial weapons or small firearms for civilians,” according to a fact sheet on its website.

The fund’s objective is long-term capital appreciation. It will have a minimum investment is $1,000 and a net expense ratio of 1.35% through Dec. 31, 2022. Its benchmark is the MSCI All Country World Index.

Cornerstone Capital manages about $1.2 billion in impact-targeted assets for wealthy and institutional clients. Karp said her goal is to move more of the capital markets into socially-conscious investments “if we are going to fight the climate crisis and if we’re going to try to heal capitalism.”

Cornerstone Capital will be the fund manager and firms including Schroders, KBI Global Investors, Green Alpha Advisors and ARK Invest will be sub-advisers.

To contact the reporter on this story: Emily Chasan in New York at echasan1@bloomberg.net

To contact the editors responsible for this story: Tim Quinson at tquinson@bloomberg.net, Alan Mirabella, Josh Friedman

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