Erika Karp on How Capitalism Can Be Good for the World

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Erika Karp believes in social justice. Perhaps that’s an understatement. The CEO of Cornerstone Capital, a sustainable investment firm, is inspired by the principle that corporations and investors can drive positive social and environmental impact while optimizing competitive returns to shareholders. “I learned very organically that looking at the most critical environmental, social and governance factors in the investment process is absolutely essential,” says Erika, who began her Wall Street career two-and-a-half decades ago and spent 15 years in equities research prior to starting her own firm. “It was there that I learned how you generate investment research that matters, that makes a difference and that supports the needs of investors.”

Erika also believes in capitalism – the kind that fosters prosperity for both investors and for those who, historically, haven’t been given that opportunity to prosper. “My goal is to move money towards impact,” she says. “The biggest thing about economic empowerment is that it’s all about access.” To give people the opportunity to succeed – and therefore contribute to the betterment of society – they must have access not just to to capital and education, but to things many people take for granted, such as water and mobility.

For women, there is the additional challenge of facing the male-dominated power structures. “Less than two percent of venture capital dollars go to women,” points out Erika. “These challenges are the legacy of society’s evolution. When it comes to big power infrastructures they change very slowly.”

Erika, quite literally, puts her money where her mouth is. Cornerstone Capital is certified by the Women's Business Enterprise National Council, meaning the majority of the board of directors and employees are women. And while she says she does always want a diverse pool of candidates, her employees were not hired because they were women – they were hired because they were the best people for the job. “It was organic,” she says. “Just like working in sustainable investing. I simply had to find the best people to do the best work. I don’t compromise in terms of who I hire.”

When it comes to the future of economic empowerment, Erika is optimistic, but points to the fact that the powers-that-be must be willing to make a commitment to it. “Sustainability can’t be a side car. It has to be deeply integrated into all investing,” she says. “You have to be creative, you have to be thoughtful, you have to be honest and you have to be collaborative.”

Erika Karp is one of the three inspiring women being honored at our October 18 fundraiser, Champions of Change. Get your tickets here!


 

Mikki Brammer