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Slow and steady wins the race

The need for speedy profits has brought the world’s financial system to its knees. Financial high-flier Woody Tasch believes his Slow Money movement, which invests in sustainable agriculture, can put the economy back on its feet.

Woody Tasch: “The Earth isn’t expanding indefinitely. We only have so much soil, water and air.”

Photo: J. Fredric May

What if you were told that one solution to crises such as global warming and the worldwide financial meltdown could be unearthed in the simple act of growing your own food? Nothing drastic; nothing revolutionary. Just a window box for a tomato plant in your kitchen.

“It’s remarkable, but people who grow their own food, who reconnect with the soil, can immediately appreciate the implications of an economy that doesn’t respect the power of ecology,” says Woody Tasch, somewhat quixotically. But Tasch is no quack. He’s chairman of the Investors’ Circle, a national group focused on funding socially responsible companies. Since 1992, Investors’ Circle has placed $130 million into 200 such businesses and venture funds. Today, sitting in the bar of a San Francisco hotel, Tasch orders a local Syrah and a fresh batch of the bar’s potato chips. “I like them because they make them here,” he explains.

“Reconnecting with the soil” may sound like a bohemian throwback. But despite the progress the environmental and sustainability movements have enjoyed in recent years, Tasch believes one aspect of social responsibility has been left out that can no longer be neglected: a more personal connection to our food. Already imposing for his height (6’2’’, some 1.9 meters), Tasch gets more and more excited as he talks. He leans into the table and gesticulates as he tosses names about—Thomas Malthus, Google, Wal-Mart, American farmer and man of letters Gene Logsdon. But it all comes down to Earth and back to sustainable agriculture.

For years, Tasch, 57, has promoted a philosophy of socially responsible investment, prioritizing the social good over the urge to make a quick buck under an ethos known as “patient capital.” Today, Tasch believes, if we have any hope of curing society’s greatest ills—much less fixing the reliance on rapid growth and rising debt that created the current crisis in the global financial markets—being “patient” with our capital is no longer enough. We need to be slow. To explain what he means, this month Tasch unveils his latest investment treatise in the form of a book entitled Inquiries into the Nature of Slow Money: Investing as if Food, Farms, and Fertility Mattered (Chelsea Green Publishing). Slow Money, Tasch writes, is “a new vision for investing that looks above the top line and below the bottom line [by] put[ting] soil fertility back into the calculus of investing.”

If Tasch’s connection between soil fertility and investing has you scratching your head, don’t worry—he intends it to sound radical. But recall that soil fertility is one of the most valuable tools we have to fight global warming, since it’s the soil and its carbon-absorbing plants on which we depend to sequester damaging carbon from the atmosphere. But being a money manager by training, Tasch isn’t entirely impractical. He doesn’t think raising your own tomatoes can solve world famine or the chaos wrenching the financial markets.

Tasch does firmly believe, however, that the simple discipline of greening our thumbs for the purpose of nourishing ourselves, of reconnecting with the planet through its soil, is an important step toward “connecting the whole person with the sustainability problem.” Do this, he argues, and we might finally change the cultural, industrial and economic systems that accelerate things like climate change or the mortgage-related debt crisis. So Tasch’s Slow Money movement is more than just a derivative of his “patient capital” social-investing agenda. It is, he says, an attempt to make a “step change” in socially responsible investing by focusing on sustainable agriculture. “Sustainable agriculture is the forgotten sustainable niche market,” Tasch laments. He quotes American poet Gary Snyder: “Food is the field in which we daily explore our ‘harming’ of the world.” If we’re to be sustainable, Tasch reasons, we must understand where our food comes from, how it’s grown and, above all, how it’s financed.

In addition to the book, Tasch has established a non-governmental organization also called Slow Money to promote his ideas through outreach seminars and marketing. Tasch’s most ambitious goal for the Slow Money movement is to raise the first venture fund dedicated to investing in local, sustainable agriculture businesses. Tasch will manage the fund like any other, but use its capital to finance only “small food enterprises” (SFEs)—companies that generate $100,000 to $1 million in annual revenues, and meet the criteria of supporting “appropriate-scale organic farming and local food communities.” Tasch plans to begin seeking investors for the fund in early 2009, and hopes to raise between $50 million and $100 million. As some of Wall Street’s most storied institutions implode—in large part due to complex schemes for making vast profits quickly—there may be no more urgent time to advance the investing mantra “Grow Slow.”

Unfortunately, the lessons of the biggest market failure since the Great Depression are hardly original. “None of this is new,” says Peter Kinder, president of the Boston-based financial services firm KLD Research & Analytics and a pioneer of socially responsible investing. “This is the second time in 20 years that this has happened ... when we’ve had a huge drop in the market as a result of these types of [abstract financial instruments],” Kinder adds, referring to the real estate market collapse of 1987. “I would hope that people in my industry have realized that investing in ‘paper,’ or securities that are not tied directly to something tangible, leads to this type of madness. Investing in real enterprises in real communities is the only type of investment strategy that makes sense.” Tasch’s Slow Money could be the connection back to Main Street that Wall Street needs right now, Kinder believes. “If you are investing in a store that is selling local produce and locally made goods you are building your community. You are building your local enterprise, and it is tangible.”

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