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Calvert Mutual Funds History

By John Guffey & Rebecca Adamson

 

1967 Wayne Silby & John Guffey meet at University of Pennsylvania Wharton School.  During college they discuss creating an investment company.

 

1970 Wayne & John graduate from U of Pa.

          Wayne goes to Georgetown U. Law School

          John goes into the US Army                                                         

 

1972 John does post graduate work at Penn State U.

 

1975 Wayne graduates from Georgetown Law school and starts Bankers Trend, a firm to broker guaranteed portion of SBA loans between banks and institutional investors.

          Wayne & John reconnect and begin discussions on starting a mutual fund.

 

1976 John takes a job with the Department of Labor and moves to DC to work with Wayne on creating a mutual fund.  They create a partnership, Government Securities Management Co. (GSMC), to act as advisor to the fund.

          Wayne & John decide to start a money market fund, First Variable Rate Fund for Government Investors or FVRF, using the government guaranteed portion of variable rate SBA loans as part of its portfolio to get a higher yield than other money market funds. This is first use of variable rate securities in a money market fund.  They hire the first employee, Pam Van Arsdale.  She goes on to become one of the first female mutual fund managers.

          Wayne sublets office space in a law firm at 1700 Pennsylvania Ave. to obtain a prestigious address.

          Wayne continues work on Banks Trend.  John goes to the FVRF office after work at DOL and both work on registration materials for the new fund with the SEC and the states.  All legal work is done by Wayne and John.  A law school classmate of Wayne’s has joined a Washington law firm and that firm agrees to be listed as legal counsel to the Fund.  Family money provides the initial $100,000 needed to launch fund.

 

December 7, 1976, First Variable Rate Fund for Government Investors is declared available for sale by the SEC and states.  Bank of New York acts as its first custodian and transfer agent.  Small NY accounting firm acts as auditor.  It ends the year with $102,000 in net assets.

 

The first shareholders’ meeting of First Variable takes place at Wayne’s parent’s home in Mason City, IA. in December 1976.  All shareholders are represented in person or by proxy.  Wayne presides and acts as secretary.  He recorded, “The shareholders voted to get the show on the road.”  Several years later we had to hire the most prestigious law firm in Maryland to opine that this constituted authorization to issue shares and conduct business.

 

1977 Fund sales are slow despite having the highest yield of any money fund.  Wayne manages portfolio and tries to market fund.  John continues at DOL and helps on the fund in the evenings.  John handles accounting and administration.  Fund ends the year with $6.8 million in assets, too small to be viable.  John goes part time at DOL to give more time to the effort.

 

1978 Fund gets some favorable media and sales pick up.  We do the first mutual fund interest rate ad in contravention of SEC rules.  SEC takes notice.  Wayne Bardsley joins firm as general counsel to deal with SEC issues.  SEC changes its rule to allow interest rate ads.

          By April FVRF reaches a viable asset level.  John leaves DOL to work full time on the fund.  Firm hires staff to support marketing and admin work.  Advisor buys 1715 18^th St., NW, DC for company offices, currently Wayne’s home.  Fund ends year with $46.1 million assets.

 

1979 After achieving the top money fund performance in 1977 & 1978, sales of the fund take off.  Wayne and John are unhappy with Bank of NY service, due to errors and many shareholder complaints.  They decide to take the transfer agency in house and move the custody to Riggs Bank in DC.  We hire Bill Holloran to write a new TA system.  Transition does not go smoothly.  Bank of New York ships in great disorder, shareholder records thrown in boxes.  It takes months to straighten out shareholder accounts.   Many mistakes were made on shareholder accounts.  By end of the year accounts are straitened out.  Significant new staff hired to run TA operation.  Ernst & Young was hired as auditor.  Fund ends the year with $179 million in assets.

 

With an influx of new college grads as employees, Calvert institutes a casual dress code for employees, very different from the required business attire of the time.  Now adopted by most companies as business casual.

 

1980 The firm out grows space at 1700 Pennsylvania and 1715 18^th Street.  The Advisor, GSMC, purchases the Calvert Street building, a former Indian restaurant, for its new offices.  FVRF sales remained strong as short-term interest rates went to double digits.  Stan Sorrell was hired from Rigs Bank to help with marketing and operations.  FVRF reaches $1 billion in net assets.  A large gathering was held to celebrate this milestone.

 

Expecting a change in bank regulation that would allow banks to pay unregulated rates on money market accounts.  Money market funds had an advantage in high interest rate environments since banks were limited by regulation on how much they could pay on savings accounts.  We began making plans to add more funds to meet this new competition and to diversify our offerings.  FVRF did not lend itself as a firm name for other funds.  The management team chose Calvert for Calvert Street and its connection to the founding family of Maryland after considering others such as Potomac, Washington, etc.

 

In addition to a new company name, we felt the need for a distinctive logo.  Wayne suggested we use the I Ching, an ancient Chinese divination tool in which 3 coins are thrown to indicate broken or unbroken lines to receive guidance for the future.  The then 6 senior managers of Calvert, John, Wayne, Wayne Bardsley, Bill Holloran, Stan Sorrell, and Ron Wolfsheimer, met on the roof deck of 1715.  Each manager in turn threw the coins.  Each got a straight line forming the first hexagram of the I Ching: the creative/dynamic, one of the most powerful symbols in the I Ching canon.  The six lines continue to be Calvert’s logo.

 

1981 The first funds under the Calvert name were created.  Calvert Tax Free Reserves Money Market Portfolio and Limited Term Portfolio.  Dave Rochat, formerly head of fixed income at Donaldson, Lufkin, Jenrette, joined Calvert to manage the new funds.  He had retired from DLJ to get out of the Wall Street grind and spend more time with family.  He purchased a small farm and moved to Vermont.  He opened a Calvert office over a funeral home in Chelsea, VT and supervised the management of the fund from there.  The Money Market Portfolio was the top performing municipal money market fund for several years.  The Limited Term Portfolio was the first short term municipal bond fund and a solid alternative to a money market fund with a higher yield and slightly higher risk.  The new funds were successful and grew rapidly ending the year with $32 million in net assets. 

 

Catherine Bardsley joins the legal department.

 

In 1981 an accounting clerk embezzled $1 million from the company by wiring it to a Swiss bank account.  Fortunately, through the bank connections of Riggs Bank, we were able to retrieve all but $50,000.  The woman and her boy friend fled to Brazil.  She was never prosecuted.  This created some adverse publicity and caused us to reevaluate and strengthen our controls and procedures.  We also added several trustees with extensive investment experience.

 

Again the company outgrew its quarters on Calvert St., and 18^th St., and 1700 Pa.   1700 Pa. was reduced to a walk-in office for shareholders to make purchases.  In a search of the DC area, the preference was to stay in DC but nothing suitable was found, the decision was then made to consolidate the offices in the Air Rights Building in downtown Bethesda, which would remain its headquarters for the next 35 years.  Bethesda was chosen over other suburban locations due to the impending arrival of Metro.

 

1982  FVRF and the tax free funds continued to be top performing funds in their categories.

 

In the late 70’s Wayne Silby attended a seminar at Another Place Farm in rural northern Massachusetts focused on the Buddhist concept of right livelihood, meaning all aspects of one’s life should reflect the person’s values and beliefs.  When he returned, he and John began discussing the idea of a mutual fund that embodied the values of our generation, and thinking about how that could be done.  At about the same time Wayne joined the board of a small startup company in Boston.  Robert Zevin of U.S. Trust Company of Boston also served on this board.  The company went was not successful.  In a strange piece of karmic coincidence, as Wayne traveled to New York on business, he met Robert in the rest room at the Marine terminal at LaGuardia Airport.  They shared a cab into the city.  Wayne brought up the idea of a socially screened fund.  Robert said that is how I manage money.  Suddenly the solution to the creation of a value based fund was evident.  So back in DC Wayne called Robert and began discussing the creation of a fund that US Trust would manage. 

 

At Another Place Wayne had met several others exploring social investing, Terry Mollner, Grace LeClair, Sydney Morris, and Marc Sarkady.  We were all in college in the 60’s and influenced by the social movements roiling the country in that period: civil rights, feminism, environmentalism, anti-war, and fear of nuclear war.  We felt that others of our generation would want to invest with their values.  The Calvert Social Investment Fund with a balanced portfolio and a money market portfolio was formed to be managed by Robert at U.S. Trust.  This was the first SRI money market fund.  Most of our mangers were opposed and the investment community was skeptical.  While not the first social fund*, it was the first to include a comprehensive set of modern value screens. 

 

Dr. Robert Zevin was one of the founding practitioners of social or responsible investing (SRI), starting in the 1960’s.  He was an economics professor at Harvard and started investing money for friends and family. Robert had started managing money full time in the mid 60’s.  He was also active in the social movements of the time.  Many of his first clients were from these groups and they asked him to manage their money while avoiding objectionable companies involved in weapons manufacture, polluting industries, etc.  Contrary to the belief at the time he found this did not detract from investment performance.  The first set of screens for the Calvert Social Investment Fund(CSIF) was based on the work of Robert Zevin with input from Wayne, Terry Mollner, Marc Sarkady, Catherine Barsdsley and Grace LeClair.  US Trust was hired as the fund’s sub-advisor.  U.S.Trust provided both social research and stock selection.  Calvert managed the money market portfolio.

 

The first trustees of the fund were Terry Mollner, Rev. Sydney Morris, Richard Baird, Wayne and John.  Terry pushed the board to allow community investments at below market rates.  We agreed we would look into implementing that policy when the CSIF Balanced Fund reached $100 million in assets.  U.S. Trust agrees that they will implement this as part of their management.

 

Robert suggested an advisory group of experts to advise the Board and US Trust on the Fund’s social screens.  The Advisory Council made of forward thinking experts in the fields of interest to CSIF’s investment criteria was created to advise the Board and sub-advisor on social considerations affecting the fund’s screens.  Marc Sarkady was tapped by the Board to be the first Chair of the Advisory Council and to find suitable candidates for its members.  Its members varied over the years but included: Randal Robinson, Robert Rodale, Amory Lovins, Hunter Lovins, Hazel Henderson, Jessica Lipnak, Jeff Stamps, Julian Bond, James Heard, Randy Barber,  Robert Browne, William Bynum, Fred Davie, Marion Wright Edelman, Michael Fischer, Sophia Bracey Harris, Erica Hunt, Rustum Roy, Byron Rushing, Gail Snowdon, Tom Stonebeck, Andrea Carmen, Gary Browse, Eric Utne, and Tim Smith, who became chair in 1990.  Tim resigned in 2000 to join Walden Asset Management, successor firm to U.S. Trust.  Byron Rushing became chair until the Council is ended in 2005.

 

The Council over the years debated the appropriate CSIF position on many issues.  The debates were heated at times but never devolved into personal attack.  Some of the more contentious discussions were: South Africa/Apartheid, beer/alcohol, nuclear power, gambling/native casinos, Burma positioning, China, support of unions, and others.

 

Growth was slow in the early years as most in the financial industry were not supportive.  Many believed that limiting the universe of investments violated the fiduciary rule.  The SEC also raised this issue, but Catherine Bardsley went around with them many times with many tweaks to the description of the screens before convincing them that disclosure allowed investors to make an informed decision about this.  Grace LeClerc was hired to head the marketing efforts for the fund.  She devised a comprehensive marketing program using public relations and extensive speaking engagements to groups sympathetic to the fund’s social mission. We received much negative feedback from the investment community and conservative commenters. While the industry was skeptical, the press loved the idea, and the fund received many favorable articles which boosted sales.  Now SRI or ESG investing is a major segment of the investment industry.

 

Calvert was one of the founding members of the Social Investment Forum, a trade association for SRI ^* investors, now the U S Sustainable Investment Forum or USSIF.

 

The company also expanded its portfolio of funds by adding non-SRI equity and income funds.  To reduce the expense of creating staff to manage these new funds, we made the decision to use outside sub-advisors for these funds.  The new funds struggled with performance issues.  The equity fund struggled through several sub-advisors until it was merged into the Social Equity Fund, now Calvert Equity.  The management of the Income Fund was brought in house in the mid-90’s and continues as the Calvert Income Fund.

This became the basic structure for Calvert equity funds going forward; Calvert would provide the social research and screening with outside sub-advisors doing the stock selection.

 

1983 The Calvert Tax Free Reserves Long Term Portfolio was created.  It continues today as the Calvert Responsible Municipal Fund.

 

As expected the Federal Reserve allowed the banks to offer money market accounts with no limit on the interest rate paid.  The banks began offering high temporary teaser rates to lure back deposits from money market funds.  Also, the banks also had the advantage of $100,000 FDIC insurance.  As most of Calvert assets were in money market funds this was a significant threat to our existence.  We responded by teaming up with a group of smaller banks to offer a brokered deposit product, T-bill Extra.  T-bill Extra paid an interest rate tied to the weekly treasury bill auction and allowed an investor to get insurance on up to $500,000 of deposits.  It also allowed the small banks to compete for deposits with the large banks and not have to pay high rates to its current local depositors.  Within 3 months of it grew to over $100 million.  The product was successful in reversing the asset drain from our money market funds and gave the company about 10 years to grow its longer-term fund products.

 

After several situations threatening the life of the company and the stresses of managing through them and changes in their personal lives, Wayne and John decide to sell the company.  Our auditor connects us with one of their other local clients, The Acacia Mutual Life Insurance Company.  Acacia was a Washington institution with a hundred-year history.  It sold life insurance through agents in offices around the country.  The sale was completed in January 1984 with a 3 year earn out.  The company had an ESOP so most of the employees received a significant payment in addition to Wayne and John.  Acacia decides to leave the Calvert non-SRI fund boards in place with the addition of several trustees of their choosing for the these boards (most of Calvert Fund assets at this time were non-SRI).  They are less interested in the social fund allowing the original board to chart an innovative course in the SRI field.

 

1984 CSIF board votes to divest South Africa holdings at Council urging; the first mutual fund to do so.

 

From 1984 Calvert changes from a no-load fund group to a load fund group to encourage sales through the Acacia network and broker-dealers.  The company continued to grow. 

 

1984 Calvert creates Money Management Plus Funds as money market funds to serve the broker/advisor market.

 

1985 Calvert Securities, a discount broker, is formed to service Calvert clients.  It never achieves profitable scale.  It became the Advisers Group to offer brokerage services to Acacia agents and financial planners.  It is now Ameritas Securites servicing Ameritas agents and clients.

 

Bill Holoran leaves the company to become head of IT for Dreyfus Mutual funds.

 

Washington Area Growth Fund was created to invest in local companies managed by the Acacia equities group.  It continued until 1991 and was liquidated after a major economic downturn in the Washington area devastated performance.

 

As the earn out ends Wayne decides to leave the company to travel and pursue other business interests.  Wayne stays president of CSIF and joins the Acacia Mutual board.  John becomes sole CEO of Calvert.

 

1986 Calvert partners with Ariel Investments to form the Calvert Ariel Fund, the first mutual fund managed by a minority owned firm.  John Rogers is the CEO of Ariel.

 

Stan Sorrell leaves Calvert to be Acacia’s operations head and later to form the Acacia Savings Bank.

 

CSIF files first shareholder proposal in the mutual fund industry on a social issue with Angelica Corp. on worker safety.

 

CSIF Managed Growth Portfolio reaches $100 million in assets.  The board begins to explore how to implement its community investment mandate.  U. S. Trust takes the lead on this effort.

 

1987 CSIF Bond and Equity funds are introduced, both managed by U. S. Trust.

 

Acacia wants the company to be managed in a more traditional way.  They did not like the more casual style that was part of Calvert culture, which included a casual dress code, now adopted by most corporations as business casual.  They were also concerned about CSIF’s shareholder activism and sponsoring shareholder resolutions as they were receiving negative feedback from the business community on these efforts.  They were not comfortable with CSIF taking controversial political positions,  Wayne and Catherine Bardsley leave the company.  Steve Top becomes Calvert general counsel.  After continuing conflict with the Acacia CEO, John decides to leave the company.  Catherine Bardsley is retained as the counsel for the CSIF fund.  John remains on the mutual fund boards.  Acacia appoints Stan Sorrell the president of Calvert.

 

1988 U. S. Trust makes 2 small investments in low-income housing projects.  Both run into trouble.  UST decides it is too costly to provide this type of investment for the fee it receives.  Calvert management also feels this type of investing is outside their expertise and too costly.  The Board decides to implement a trial program and makes several small investments in community loan funds.  We decide to call this our High Social Impact Investment portfolio(HSII).  Impact investing is now the accepted term for community development and other investments made with a primary social purpose as well as a financial goal.

 

1989 CSIF board creates Calvert Social Investment Foundation to study the effect of military spending on the US economy.

          The Calvert Ariel Appreciation Fund is created to follow on the success of the Calvert Ariel Growth Fund, also managed by Ariel Investments and John Rogers.

          Building on its success and reputation in managing tax free funds, Calvert creates the Calvert Tax Free Reserves California Money Market Portfolio.

Calvert is a founding member of CERES, a coalition of environmental investors promoting standards for corporate environmental reporting.

 

1989 John and Wayne recruit Rebecca Adamson, who created the first micro loan fund in the US, to join the CSIF board to create the high impact program.  Rebecca and Terry are co-chairs of the High Social Impact Investment (HSII) Committee and Rebecca does the vetting with Steve Sheath and Reed Montague for the committee.  Joy Jones joins the CSIF board making it the most diverse in the mutual fund industry.

 

Wayne and John join with John May to form Silby Guffey LLC, an advisor  to Calvert Social Ventures Partners LP, a new private venture capital fund investing in companies creating cutting edge technologies in the fields of environment, education, and health care.  One of the first venture funds employing ESG/SRI policies in the investment process. In the early 90’s  Silby Guffey is one of the founding members of the Emerging Europe Fund LLC, a venture fund investing in the newly free countries of central Europe.  John May goes on to form several venture funds investing in women created companies and is a founder of the “angel investor” movement, which forms investment clubs in various cities to invest in start-up businesses to promote economic development.

 

1990 Calvert Foundation issues its study on the effects of military spending on the US economy.  The release generates several media articles.  The Soviet Union collapses, and the US reduces military expenditures.  The Foundation goes dormant for several years until the board decides to create a loan fund to invest in community development organizations.

 

Tuck Nason, new Acacia CEO, joins the CSIF Board.

 

Calvert hires Jon Lickerman to form a social research group reducing its dependence on U. S. Trust.

 

CSIF shareholders meeting in DC overwhelmingly approves investing up to 1% of assets in the high impact program.  Several shareholders push for more with general agreement by others present.

The enthusiastic response of the CSIF shareholders causes the CSIF board to begin researching the possibility of creating a pure high impact investment vehicle available to all investors.

 

Calvert files a shareholder proposal at ARCO requesting the board do more to prevent spills from the pipeline at its annual shareholders’ meeting in response to the Exxon Valdez oil spill.  Wayne Silby speaks at the meeting.  ARCO is the major operator of the Alaska oil pipeline.  The ARCO president invites Wayne to tour its Alaska operations and safety policies.  Wayne and Marc Sarkady tour its facilities and report to the Board and Council. 

CSIF becomes the first mutual fund to use the tools of shareholder ownership to promote ESG practices in corporate America.  Shareholder activism including engagement with companies about their polices and when necessary to get their attention file shareholder proposals.

 

1991 Calvert creates a NJ Tax Free Money Market fund and a Vermont Tax Free Fund due to Dave Rochat’s work in Vermont.

 

1992 Calvert creates Calvert World Values fund, the first SRI international fund.  Wayne, John, Stan, Terry Mollner, Dr. Rustum Roy, Tessa Tennant, a pioneer social investor in the UK, and Mohammad Yunus, founder of the Grameen Bank and Nobel Laurette, are initial board members. 

 

1992-3 Under Dave Rochat’s leadership Calvert has one of the best performing municipal bond management groups in the industry.  After years of strong municipal performance Calvert creates an intermediate tax-free fund and single state municipal bond funds for Maryland, Virginia, Arizona, Florida, California, Michigan, New York, and Pennsylvania, all later dropped due to weak sales.

 

1993 First exchange traded fund (ETF) an index fund based on the S&P 500 was created and traded on the New York Stock Exchange.

 

1994 In a dispute about how to market the Ariel Funds.  Calvert and Ariel agree to go their separate ways. 

Calvert replaces U. S. Trust as sub-advisor to CSIF Equity portfolio due to poor performance.  Loomis Sayles, an established investment firm, is hired to manage this portfolio.

The Calvert Capital Accumulation, now Calvert Mid-Cap Fund, was created under the World Values Board.

 

Calvert creates the Calvert Strategic Growth Fund, one of the first mutual funds to use hedge fund strategies including futures, options, shorting, etc.  It was also the first mutual fund to implement these strategies in an ESG fund.  The fund posts disappointing returns for several years and is discontinued.

 

1995 Calvert replaces U. S. Trust as sub-advisor to the Managed Growth or Balanced portfolio.  Brown Capital and NCM Investments, both minority firms, take over equity portion of Balanced portfolio.  Bond portion is managed in house.  Calvert Social Research provides the ESG research.

 

Calvert creates the Calvert New Africa Fund, the first Africa centric mutual fund.  The fund is sub-advised by NCM Capital Management.

 

1995 After a study of legal structures and a survey of fund shareholders, the Foundation board makes the decision to become a community loan fund to be offered to retail investors.  This becomes the first national security in impact investing available to the general public.  Rebecca Adamson, based on her experience starting the first US micro loan fund, takes the lead in writing a proposal to the Ford Foundation, Mott Foundation, and MacArthur Foundation to provide initial funding and subordinate debt to launch the fund. Calvert legal registers the Community Notes in all states for sale.  Notes would be sold directly and through brokers to individual investors willing to accept a below market interest rate to support community impact.  Loans would then be made to community development organizations that would not qualify for funds from the capital markets and at below market rates.

Kathy Keeley is hired by Terry and John to run the Calvert Foundation and begin receiving the HSII investments. Calvert Trustees restructure the Foundation Board: Rick, Sydney and Joy step off the Foundation Board for more independence for the Foundation from CSIF.  Terry, Wayne, John and Rebecca with Grace Leclerc and Marc Sarkedy become the Calvert Foundation board so the HSII investments are done separately from the CSIF Board.

 

1996 Kathy Keeley as Foundation executive director does not work out and she is replaced by Shari Berenbach.

 

1996 The CSIF Board decides to designate a small portion of the fund’s portfolio to social venture capital, thinking this as a way of supporting more directly companies creating the positive social impact the fund wants to encourage.  Calvert management feels it does not have the expertise to manage this type of security.  The Board decides to take on the responsibility to manage this portion of the fund under Wayne’s leadership, based on his years managing Calvert Social Venture Partners.  We name the program Special Equities.  This one of the first mutual funds to do venture investing.

 

Jon Lickerman leaves Calvert to become a parent.  Julie Gorte becomes head of Social Research.

 

1996 CSIF board makes decision to transfer high impact investments to the foundation.  All existing HSII investments in CSIF are transferred over to the Calvert Foundation (Rebecca does the due diligence).  CSIF then makes an investment in Community Notes issued by the Foundation.  The CSIF Board then reviews the Foundation’s performance on a quarterly basis.

SEC grants an exemption to allow this.  Calvert funds continue this program to this day.

 

Greg Habeeb is hired to manage taxable fixed income funds.  Greg employs a high trading volume and risky style.  This creates both high returns and eventually leads to big losses.

 

After several years of poor sales Acacia decides to replace Stan as CEO.

 

1997 Barbara Krumsiek becomes Calvert CEO.  Barbara comes from Alliance Capital where she headed pension sales for their mutual funds.  Barbara revamps marketing and sales, replacing most of the personnel in these departments.  Sales effort becomes more professional and focused.

Calvert New Visions Small Cap Fund is formed, now Calvert Small Cap Fund.

 

1998 Calvert creates an ESG index fund, Calvert Social Managed Index, not the first social index but a fund more representative of the market than the Domini Social Index.

 

1998 Calvert Foundation creates the Calvert Donor Advised Fund with assets invested in Calvert social funds, the first ESG donor advised fund.

 

1999 Ameritas Life Insurance Co., a mutual life insurance company based in Lincoln, NE, merges with/buys Acacia.

 

Calvert with Rebecca Adamson’s help creates the first mutual fund indigenous rights screen, later adopted by other ESG investment managers.

Calvert with Rebecca Adamson continues to promote the IP, indigenous peoples, Screen, placing it into the Socrates data base sold to MSCI.  IP Brokers training is accredited and offered to certified brokers.

 

2000 Calvert creates the Calvert Social Index, an unmanaged index consisting of a screened version of the Russell 1000.  Vanguard licenses the Calvert Social Index for its first ESG fund.  After one year in a dispute over fees for using the index Vanguard drops the Calvert index for the FUTSI For Good sustainable index.

 

Dave Rochat steps back from daily fund management except for the Vermont Tax Free Fund.  Reno Martini assumes management of other tax free portfolios.

 

2000 Joe Keefe hired as a consultant on marketing and social issues.  He works closely with Julie Gorte. 

 

Barbara’s method of new product development is to see what is selling in the market and create a copycat product in that category.  She creates the Calvert Technology Fund at the height of the dot com bubble.  Within a year the bubble bursts and the fund is closed.

 

2001 New Africa Fund merged into World Values Fund after several years of poor performance and the discovery that an NCM employee had an interest in a portfolio investment that defaulted.

 

2001 Calvert merges Bridgeway Social Fund into the Calvert Social Equity Fund.  Bridgeway, headed by John Montgomery, becomes sub-advisor to the fund.  Miles Harper joins the CSIF board from the Bridgeway Fund board.

 

Calvert signs UN Global Compact.

 

2002 Greg Habeeb buys a large bond issued by Lumberman’s Mutual that goes bankrupt causing a large loss in Calvert Income Fund.  This causes a shake up in the investment department with Reno Martini let go.  This starts a decline in the performance of the tax-free funds.

 

2004 Joe Keefe and Julie Gorte create the Calvert Womens Principles in consultation with the UN.  They were later turned over to the UN to become the UN Women’s Empowerment Principles.

 

2005 Joe Keefe leaves to head Pax World funds, now Impax.

 

Calvert creates first ESG asset allocation funds.

 

Tuck Nason retires as Acacia CEO and leaves the CSIF Board.

 

Dave Rochat retires from the Calvert non-SRI board.

 

2005 The Advisory Council was ended in a move to reduce fund expenses and the burden of preparing for meetings on social research.  Julie Gorte leaves to join Pax World.

 

2006 Under Greg Habeeb’s management Calvert Income is the top performing bond fund for several years.  Sales of this fund take off.  Assets grow to over $6 billion becoming Calvert’s largest fund.

 

Catherine Bardsley leaves as general counsel to Calvert Social Investment Fund.

 

2006 Bennet Freeman hired to head Social Research and Corporate Engagement.   He does much to professionalize the department and increase Calvert’s profile in the field of corporate activism.

 

2006 Greg Habeeb makes a large investment in Dulles Greenway bonds in the Calvert Income Fund and the CSIF Bond Fund. 

 

2007 Calvert creates Alternative Energy Fund to invest in companies that produce clean energy and conserve energy.

 

2008 Calvert creates Global Water Fund to invest in companies and new technologies that conserve this vital resource.

 

ETF’s offer several advantages over traditional mutual funds for taxable investors: tax advantages, lower fees, and ability to trade.  CSIF trustees encourage Barbara to create Calvert ETF’s.  She feels they are a fad and only suitable for institutional traders.  Calvert misses this major trend in the industry.  ETF’s now outsell traditional funds.

 

2009 In response to the Great Recession the Federal Reserve reduces rates to almost 0.  This leaves no margin for fees on money market funds.  After several years of low rates which last until 2021, Calvert leaves the money market business on which it was founded.

 

2010 Due to losses on privately placed investments that were impacted by the recession, the Calvert Tax Free Reserves Limited Portfolio was liquidated.  This had been a ground breaking and very successful fund until its recent troubles.

 

2010 Calvert Foundation spins off the donor advised fund into an independent 501C-3, named Impact Assets.  It now has assets over $3 billion.

 

2011 Calvert creates the Emerging Markets Fund, first ESG emerging markets fund.

 

2013 Calvert creates the Green Bond Fund, the first green bond fund.

 

2013 As a result of the recession traffic on the Dulles Greenway is greatly reduced resulting of a default on the bonds.  In looking into this it was determined that the bonds had been greatly over valued for several years.  This resulted in an SEC action and Ameritas paying tens of millions to reimburse shareholder losses.  Greg Habeeb is let go.

 

2015 After the Toll Roads debacle costing Calvert/Ameritas millions to clean up, Ameritas decides to change Calvert CEO.  They choose John Struer formerly of Affiliated Managers Group.

 

2015 Jen Pryce becomes executive director of the foundation and takes it to new level, now over $660 million in assets.

 

2016 John Struer becomes Calvert CEO.  Struer states a goal to make Calvert the premier environmental fund group.  Ron Wolfsheimer, Calvert’s long time accounting head, and Bill Tartikoff, Calvert General Counsel, are let go also as a result of Toll Road issue and John’s restructuring.

Struer makes all Calvert funds ESG. Up until this time most of the Calvert funds were not ESG.  He oversees the writing of the Calvert Principles replacing the social funds screens.

 

2016 Indian tribes in South Dakota begin protesting the building of the Dakota Access Pipeline (DAPL).  The pipeline threatens to pollute the tribes’ water supply.  Rebecca Adamson and First Peoples Worldwide is asked to coordinate investor/shareholder efforts to oppose the pipeline by instituting shareholder actions with the companies building the pipeline and the banks funding the effort.  Calvert sends representatives to South Dakota to investigate and lend support to the shareholder effort.  Calvert joins in shareholder engagement on this issue.

 

2017. Ameritas sells Calvert to Eaton Vance, a large mutual fund advisor based in Boston. Struer does major reduction in force at Calvert reducing staff from about 150 to 40 by outsourcing many functions performed by Calvert staff. Calvert moves to Connecticut Ave. in the District.  Calvert back office functions and fixed income management are assumed by Eaton Vance in Boston.  Calvert office does social research/shareholder activism and marketing.  Most Calvert equity funds are managed by EV affiliates with exception of the International Fund, formerly World Values, and the Emerging Markets Fund.  Funds are sold through the Eaton Vance wholesaler network with support by Calvert ESG specialists.

Calvert funds’ several boards are reorganized and combined.  Wayne Silby, Rebecca Adamson, Terry Mollner, Sydney Morris and several long time Acacia appointed board members retire.  Surviving board members are:  John Guffey, Richard Baird, Joy Jones, Tony Williams, Alice Bullock, Cari Dominguez, and Miles Harper.

 

John Struer makes major changes to fund line up.  He converts the Alternative Energy and the Water funds to custom Calvert index funds.  He creates a series of ESG index funds in the major asset categories.  With the Eaton Vance and later Morgan Stanley sales force Calvert assets reach new highs, over $30 billion.  He ends the special equities program.

 

March 1, 2021 Morgan Stanley buys Eaton Vance.  MS makes significant changes in EV management ranks as many EV managers exercise their stock options and retire.

 

2022 Morgan Stanly creates Calvert ETF’s and Calvert European funds with a new Morgan Stanley appointed board.

 

2023 Ted Eliopolis becomes Calvert CEO as transition CEO.  He makes minor changes in Calvert staffing.  John Struer becomes chair of the Calvert Research board.  Calvert moves to new offices in DC on M St., NW.

John Guffey and Richard Baird retire from Calvert Funds board.  Eddie Ramos and Karen Fang join the board as replacements.

 

2024 John Struer leaves Calvert/Morgan Stanley.  Von Hughes becomes Calvert CEO and joins the Calvert Funds board.

 

Calvert Impact Capital, formerly the Calvert Social Investment Foundation, is granted $7 billion by the EPA under the Inflation Reduction Act to support energy transitions in low income communities in the US.

 

*SRI, socially responsible investing, and ESG, environment, social and governance, are used interchangeably in this article.  The term for using environmental and social values as well as accepted good governance practices in the investment process has changed several times over recent years, from SRI to responsible investing to ethical investing to sustainable investing to impact investing finally ESG.  Social investing by religious investors has a long history dating to colonial times with Quakers avoiding investing in the slave trade.  Later the sin screens of alcohol, tobacco and gambling were adopted by religious investors.  Several mutual funds were created in the 1920’s to appeal to this group.  This remained social investing until 1971 when Pax World Fund added anti-weapons maker screens in response to the Vietnam War.  Calvert in 1982 introduced the first comprehensive set of issues for review in the investment process and including shareholder activism.  There is no set definition of the values espoused by ESG investors and a wide variety of approaches are used by various companies: progressive, Catholic, Islamic, conservative, women focused, etc.  DEI or diversity equity and inclusion is another recent movement promoting the inclusion of minorities and women in arts, education, government, and business.

 

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