For the greater green and gold
Green ventures: Terra Alpha Investments currently has constructed a portfolio of 95 environmentally efficient companies. Photo by University Advancement
Tribe: William & Mary alumni, Brendan Corbett ’15 (left) and Rita Morency ’13 (right), both work as research analysts at Terra Alpha Investments. Photos courtesy of Terra Alpha Investments
The following story originally appeared in the spring 2017 issue of the W&M Alumni Magazine - Ed.
Timothy Dunn ’83 was at the height of his career as a global portfolio manager. He managed funds in the billions. With a worn passport and a suitcase always on standby, Dunn estimates he’s traveled to Japan more than 25 times in addition to many other countries across the globe.
But Dunn wanted more.
He wanted to make an impact on the world by leaving a greener footprint behind.
In 2014, Dunn founded Terra Alpha Investments LLC, an advocacy investment firm, after working in the investment management industry for more than 25 years. Terra Alpha invests in companies that are making a smaller imprint on the earth’s natural resources through greener business practices. They gauge a company’s environmental productivity based on their carbon emissions, water and material efficiencies.
“I wanted to do something more meaningful in my life,” Dunn said. “I don’t want my tombstone to say, ‘great portfolio manager.’ Not that there is anything wrong with being a great portfolio manager. I just want to leave this world a better place by focusing my energy on ways to improve the environment.”
A global force Dunn was headed to the University of Rochester for college, but then it snowed.
It was a snowfall that changed his path from upstate New York to Williamsburg, Va. Shortly after being accepted, he heard that Rochester was covered in five inches of snow. Though snow is typical for upstate New York, this snowfall didn’t occur in the dead of winter, or even early spring — it arrived on May 3. He changed his mind that day and decided to attend William & Mary where he had also been accepted.
It was a wise decision for many reasons, including meeting his wife, Ellen Stofan ’83 D.Sc. ’16, during their junior year. Stofan, former chief scientist at NASA, is now a member of Terra Alpha’s advisory board. While at NASA, Stofan led efforts to study global climate change. Two of the couple’s three children, Ryan ’10 and Emily ’14, graduated from W&M. Dunn is the chair of the Reves Advisory Board and previously served on the William & Mary Board of Visitors.
Dunn came to W&M to study law, but as he neared graduation, that aspiration had transformed into something else. When he took the class international trade and finance, it fueled his interest to work globally.
Dunn spent most of his career at Capital Research Global Investors working as a senior vice president, portfolio manager and an equity analyst. The global sectors Dunn covered included consumer products, electrical equipment and industrial companies. After spending 19 years there, Dunn was ready for a change.
“I felt my work was lacking a bigger purpose than just financial gain, and I wanted to devote my time to environmental challenges,” Dunn says. “Of course now, via Terra Alpha, I am able to marry my investment skills with my environmental passion to bring investors both environmental and financial gains.”
Earth first
Terra Alpha’s headquarters is located in Middleburg, Virginia. Middleburg, a town of 800 people, sits in the shadow of the nation’s capital among endless rolling hills and horse pastures lined with wooden fences that stretch for miles.
Since its founding, Terra Alpha has constructed a portfolio of 95 publicly traded companies, which include BMW, MetLife, Apple, adidas, Sysco, Wyndham Worldwide Corp and UnitedHealth Group. The companies in Terra Alpha’s portfolio were rated more than 90 percent more efficient compared to others in their use of carbon and waste generation, according to Terra Alpha’s fourth quarter newsletter. The companies were 70 percent more efficient in water usage.
Unilever, a company in Terra Alpha’s portfolio that owns 400 brands, including Dove, Lipton, Hellmann’s and Vaseline, has created waterless foaming shampoos and laundry detergents, which require less water.
“By both identifying and investing in the leading companies across all sectors, we seek to enhance our investor’s financial returns and reward superior corporate behavior,” Dunn said. “If more investors used the power of their financial assets to encourage such behavior our overall economic system will shift to become more aligned with our natural systems; which is a win for everyone.”
Green and gold
Dunn looks to his alma mater as a major source of hiring at Terra Alpha. He’s employed six William & Mary students as interns, and of those, he hired Rita Morency ’13 and Brendan Corbett ’15 as full-time employees.
“The students from William & Mary know how to think critically and write really well,” Dunn says. “In our business, there is a lot of critical thinking, independent research, and a lot of writing.”
Morency and Corbett work as research analysts, writing reports about environmental productivity for the advocacy arm of Terra Alpha, which encourages companies to be more transparent in their usage and reporting of natural resources.
“Now is an important time to fight for and invest in the protection of our environment and our natural resources because, frankly, the future of humanity depends on it,” Morency says. “I think that it is becoming more obvious to companies that the way they currently use and impact natural resources is unsustainable, both environmentally and financially.”
Corbett says that Terra Alpha is working to shift the thinking of companies by educating the investment community to incorporate environmental factors into their investment processes.
“Essentially, once the capital markets fully acknowledge the material value and financial impact of environmental performance on a company’s bottom line, a huge opportunity for changing how the private sector impacts our planet and its natural resources will be unlocked,” Corbett says.
Ultimately, environmental efficiency is the responsibility of everyone, Dunn says.
“We all have the ability and the responsibility to shape the future,” Dunn says. “We can’t just look to the president, governor, business leader or minister to do this. At the end of the day, it’s going to be up to all of us.”
