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Trillium Asset Management

Type:

Investment management firm
Formation:

1982

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Trillium Asset Management, LLC is a Boston-based investment management firm that directs investments to support a left-leaning environmental and social agenda. Trillium is an activist investor that regularly buys stakes in companies it disagrees with, such as energy companies, so that it can exert pressure to change their behavior.

Founded in 1982, Trillium claims to be a pioneer in “socially responsible investing” (SRI) and to be the oldest investment advisor devoted “exclusively to sustainable and responsible investing.” 1 It is one of the largest SRI firms in the U.S.,2 with $2.53 billion in assets under management and 24 full-time financial advisors. 3

Trillium has been engaged in multiple high-profile and controversial cases of investment activism. It has pressured numerous Fortune 500 companies, including Facebook and Nike, to add women and ethnic minorities to their boards and disclose data about the races and genders of their employees. 4

In 2012, Trillium was subpoenaed by Chevron in relation to what Chevron’s lawyers called “a massive fraud and extortion scheme” in which activist investors were seeking to force Chevron to settle an environmental lawsuit in Ecuador. 5

Founding and Leadership

Trillium Asset Management was founded by Joan Bavaria in 1982 as Franklin Research and Development. In its early days it served as a research firm dedicated to providing information to investors on the social impact of publicly traded companies from a left-of-center perspective. 6

Franklin Research & Development was renamed Trillium Asset Management in 1999 to reflect its evolution into an asset management and investment firm. 7 Trillium uses an investing approach that’s focused on environmental, social, and governance (ESG) factors that opposes sectors such as conventional energy, nuclear power, military weapons systems, and tobacco. 8

Trillium manages investments for the very rich, private foundations, endowments, and religious and nonprofit organizations. 9

Joan Bavaria managed the company until her death in 2008. At that time, it had just under $1 billion in assets under management. 10 Following Bavaria’s death, financial analyst Matt Patsky took over as CEO, who is “widely considered as an expert in socially and environmentally responsible investing.” 11

Affiliated Organizations

Trillium has served as an incubator for other left-leaning environmentalist and social impact organizations, most of which were also founded or co-founded by longtime Trillium manager Joan Bavaria. 12

In 1981, Bavaria co-founded the Social Investment Forum, an organization of companies and organizations intended to advance left-of-center activist investing. 13

In 1989, following the Exxon Valdez oil spill, Bavaria co-founded Ceres (formerly the Coalition for Environmentally Responsible Economies), an organization of environmental groups and investor-activists formed to impose harsher environmental restrictions and reporting standards on public companies. 14 Ceres was responsible for the Global Reporting Initiative (GRI), an international standard for corporate environmental disclosure currently used by 93% of the world’s 250 largest companies. 15

In 2003, Trillium co-founded and incubated the Sustainability Investors Research Network. 16

In 2006, Trillium launched “Open MIC,” the Open Media and Information Companies Initiative, 17 which leads shareholder activism campaigns in the media and tech space. 18

Investor Activism

Trillium today calls itself “a leader in shareholder advocacy and public policy work.” 19 Its activism efforts focus on a range of left-of-center issues, including imposing environmental disclosure requirements, increasing workplace diversity quotas, and limiting executive compensation. 20

In the 1990s, Trillium began pressuring companies to adopt more liberal protections for LGBT employees. It has partnered with other liberal activist firms, including Arjuna and Pax, to target a range of alleged corporate missteps on issues of gender identity, sexual orientation, and gender pay gaps. 21

According to Bloomberg News:22

Boston-based Trillium is one of a handful of activist investors that punch way above their weight when it comes to pushing diversity. These activists have prodded some of the largest public companies in the world to add women and minorities to their boards, to disclose data about the race and gender of their workforces, and to protect LGBTQ employees.

Trillium has also been critical of high executive pay in companies, and it has gone after companies with CEOs deemed too powerful. In May 2019, Trillium put forward a Facebook shareholder proposal to fire Mark Zuckerberg as chairman. Trillium Senior Vice President Jonas Kron read out a message during Facebook’s shareholder meeting, in front of Zuckerberg, saying it is “unwise to have so much power concentrated in one person.” 23

Trillium is active in supporting left-leaning environmentalism proposals. In 2017, Trillium released a guidebook advising investors on how to eliminate conventional energy companies from their portfolios. 24

Chevron has been a frequent target of Trillium. In December 2012, Chevron subpoenaed Trillium regarding a case in which Chevron had been accused of polluting sections of a remote region in the Amazon. Trillium was working closely with plaintiffs in the case to pressure Chevron into a settlement.  Randy Mastro, a lawyer representing Chevron in the case, said:25

Our case is about a massive fraud and extortion scheme for billions of dollars. The conspirators enlisted a network of not-for-profits, so-called shareholders who were acting independently but really acting in collusion to get out their false story. We have a right to take discovery of those shareholders and those groups they enlisted to try to find out the methods of the scheme.

References

  1. “History.” TrilliumInvest.com. Accessed November 11, 2019. https://trilliuminvest.com/socially-responsible-investment-company/history-joan-bavaria/
  2. “History.” TrilliumInvest.com. Accessed November 11, 2019. https://trilliuminvest.com/socially-responsible-investment-company/history-joan-bavaria/
  3. Lipscomb, Sam. “Trillium Asset Management Review.” Smart Asset. September 10, 2019. Accessed November 12, 2019. https://smartasset.com/financial-advisor/trillium-asset-management-review
  4. Colby, Laura. “How Three Activists Confront Companies on Diversity and Prevail.” Bloomberg. October 14, 2016. http://www.bloomberg.com/news/articles/2016-10-14/how-three-activist-firms-confront-big-companies-and-prevail
  5. Morgenson, Gretchen. “Chevron Aims at an Activist Shareholder.” The New York Times. December 8, 2012. Accessed November 12, 2019. https://www.nytimes.com/2012/12/09/business/chevron-takes-aim-at-an-activist-shareholder.html
  6. “OBITUARY: Joan Bavaria.” WickedLocal. Nov 26, 2008. Accessed November 11, 2019. https://www.wickedlocal.com/x415854382/OBITUARY-Joan-Bavaria
  7. “We’re 25!” Investing for a Better World – A Publication of Trillium Asset Management Corporation. Summer 2008, Vol 23. No. 2. Accessed November 11, 2019. https://trilliuminvest.com/wp-content/uploads/2008/08/trillium_ifbw_summer08.pdf
  8. Lipscomb, Sam. “Trillium Asset Management Review.” Smart Asset. September 10, 2019. Accessed November 12, 2019. https://smartasset.com/financial-advisor/trillium-asset-management-review
  9. “B Impact Report: Trillium Asset Management.” BCorporation.net. Accessed November 11, 2019. https://bcorporation.net/directory/trillium-asset-management
  10. “OBITUARY: Joan Bavaria.” WickedLocal. Nov 26, 2008. Accessed November 11, 2019. https://www.wickedlocal.com/x415854382/OBITUARY-Joan-Bavaria
  11. “Trillium Asset Management Corporation Announces Hiring of Matthew Patsky as its New CEO.” CSR News. October 21, 2009. https://www.csrwire.com/press_releases/27975-Trillium-Asset-Management-Corporation-Announces-Hiring-of-Matthew-Patsky-as-its-New-CEO
  12. “History.” TrilliumInvest.com. Accessed November 11, 2019. https://trilliuminvest.com/socially-responsible-investment-company/history-joan-bavaria/
  13. “OBITUARY: Joan Bavaria.” WickedLocal. Nov 26, 2008. Accessed November 11, 2019. https://www.wickedlocal.com/x415854382/OBITUARY-Joan-Bavaria
  14. “OBITUARY: Joan Bavaria.” WickedLocal. Nov 26, 2008. Accessed November 11, 2019. https://www.wickedlocal.com/x415854382/OBITUARY-Joan-Bavaria
  15. “About GRI.” GlobalReporting.org. November 12, 2019. https://www.globalreporting.org/Information/about-gri/Pages/default.aspx
  16. “We’re 25!” Investing for a Better World – A Publication of Trillium Asset Management Corporation. Summer 2008, Vol 23. No. 2. Accessed November 11, 2019. https://trilliuminvest.com/wp-content/uploads/2008/08/trillium_ifbw_summer08.pdf
  17. “We’re 25!” Investing for a Better World – A Publication of Trillium Asset Management Corporation. Summer 2008, Vol 23. No. 2. Accessed November 11, 2019. https://trilliuminvest.com/wp-content/uploads/2008/08/trillium_ifbw_summer08.pdf
  18. “What We Do.” OpenMic.org. Accessed November 22, 2019. https://www.openmic.org/what-we-do
  19. “Profile: Trillium Asset Management.” Confluence Philanthropy. Accessed November 12, 2019. https://www.confluencephilanthropy.org/Trillium-Asset-Management
  20. “Shareholder Proposals.” Trillium Asset Management. Accessed November 22, 2019. https://trilliuminvest.com/approach-to-sri/shareholder-proposals/
  21. Colby, Laura. “How Three Activists Confront Companies on Diversity and Prevail.” Bloomberg News. October 14, 2016. Accessed November 22, 2019. https://www.bloomberg.com/news/articles/2016-10-14/how-three-activist-firms-confront-big-companies-and-prevail
  22. Colby, Laura. “How Three Activists Confront Companies on Diversity and Prevail.” Bloomberg News. October 14, 2016. Accessed November 22, 2019. https://www.bloomberg.com/news/articles/2016-10-14/how-three-activist-firms-confront-big-companies-and-prevail
  23. Kanter, Jake. “’It is unwise to have so much power concentrated in one person’: Here’s the stinging message that will be read out to Mark Zuckerberg today by an investor who wants to take him down (FB).” Business Insider. May. 30, 2019. https://markets.businessinsider.com/news/stocks/investors-demand-facebook-fire-mark-zuckerberg-as-chairman-2019-5-1028242525
  24. “Trillium, Green Century, & 350.org Launch New Investor Guide to Fossil Fuel Free Investing.” CSR News. Apr 19, 2017. Accessed November 12, 2019. https://www.csrwire.com/press_releases/39895-Trillium-Green-Century-350-org-Launch-New-Investor-Guide-to-Fossil-Fuel-Free-Investing
  25. Morgenson, Gretchen. “Chevron Aims at an Activist Shareholder.” The New York Times. December 8, 2012. Accessed November 12, 2019. https://www.nytimes.com/2012/12/09/business/chevron-takes-aim-at-an-activist-shareholder.html
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