This week is Climate Week, and it is time for Jewish funders and foundations to take meaningful action. 

My husband and I have been investing in Israel’s environment through philanthropic grant-making for the last nine years, and we recently joined the PAI Fund — a new and innovative philanthropic partnership dedicated to climate mitigation in Israel — as founding board members. We are engaged in this work because climate affects every aspect of our lives, including Israel’s security, with serious implications for the region and the world. Indeed, Israel sits in one of the world’s few climate change “hot spots,” with temperatures already surpassing the 1.5 degree rise threatening the rest of the world.

While philanthropy and working in collaboration are critical, “wicked problems” require multi-pronged approaches. In this vein, we realized early on that we must also mobilize our investments for greater impact. This is imperative, as our personal money and philanthropic endowment represent a much bigger part of the pie than our yearly philanthropic grants. I’m sharing part of my journey in the hope that you can learn from our experience — if we can do it, you can too. 

My husband’s and my story started a decade ago, after the IPO of the Israeli startup Mobileye. We were starting from scratch: Prior to 2014, we were neither philanthropists nor impact investors. We made a concerted decision to focus our philanthropy on Israel’s environment, both for the reasons stated above and because it was an area I felt passionate about from my work as an Israeli tour guide. But when it came to our investments, our journey started somewhat by accident. 

We knew needed someone to manage our investments, so we went to the bank in the U.S. where we already held a small savings account. When the investment manager recommended one particular exchange-traded fund (EFT), I noticed there were fossil fuel companies like Exxon, Shell and BP on the list. I told him I didn’t think we should invest in those because we would be making grants to environmental causes, among others. Without a hint of irony, he responded: “Don’t worry — we’ll make you more money, and then you’ll have more money to give away.” 

At the time, I didn’t even know what an ETF was or what “fiduciary duty” meant, but I did know that I found it patronizing to have investment managers telling me that I couldn’t make money and be environmentally responsible at the same time. I took it as a dare. 

Now, nearly a decade later, I know differently. While there’s no guarantee with any investment, managing money toward environmental responsibility can davka be a way to maximize returns. And fiduciary duty is more than just worrying about a financial bottom line. 

We have leaned heavily into direct impact investing in Israeli startups; in our robust portfolio of more than 40 impact startups, roughly half are involved in climate tech. Equally important, we looked for solutions in our public equity holdings — the biggest piece of our asset pie because of their lower risk profile and liquidity. We were frustrated with the lack of true solutions in this area, so we jumped at the chance to seed an Israel-based, values-aligned investment house, Value Squared. Value Squared goes beyond just screening out fossil fuels, using a best-in-class approach that does deep analysis of the climate, social and governance impacts of all its holdings. 

We’ve been on an uplifting and empowering journey with measurable impact, and it has greatly amplified our philanthropic commitments in the climate space. Here are a few takeaways I would like to share with you this Climate Week: 

First, ask questions of your financial advisors and investment managers. Don’t assume they intimately know the holdings in your portfolio. We have come to realize that many fund managers are “six degrees” separated from their data. They may have very little direct contact with the financial analysts making the recommendations and may not know the basis of decisions, relying instead on the label only. 

For example, once we were meeting with an investment manager in Israel and he was excited to tell us about a new climate-focused ETF. He knew we cared about climate, and he saw this fund had excellent financial performance, but when we asked him about the companies in the fund, he had no idea — he had never looked at the holdings. He literally told us that he would Google the ETF for more information. 

Second, dig deeper and ask about the source of the data that is the basis of the decision making. Which database do they use? Does the database give comparisons of companies in the same sector and same geographic region? How does the database (and the analyst) deal with controversies? Not all data—and databases—are created equal, and an ESG (environmental, social, and governance) investment is only as good as the ESG data underlying it. Beware of the fine print—some funds allow themselves up to a certain percentage of fossil fuels in their holdings, even if those companies have nothing to do with the energy transition. 

Third, don’t be intimidated. Use the same due diligence skills you bring to vetting NGO’s. They are easily transferable to vetting investments. I say this because I have met savvy foundation professionals who claim they are not comfortable in the investment world. The key is to be curious and to ask questions. It’s a different vocabulary, but the learning curve is quick. 

Fourth, just get started. There is no way to find perfection here. When it comes to public corporations, there are no saints — and frankly, we are not saints either. The best place to start is to weed out the fossil fuel holdings in your portfolio. Then go an extra step and look for holdings that have a low carbon footprint on all their goods and services; simply put, all goods and services have a carbon footprint. You can have a robust, diversified fund with market returns and no fossil fuel investments and low carbon footprint on the rest of its holdings. Don’t take no for an answer. 

Start now, this Climate Week. Together we can make a difference and shift the financial arena toward a sustainable future. 

Marla Stein is an Israel-based philanthropist, activist, impact investor and licensed Israeli tour guide. She is co-chair of the Jewish Funders Network’s Green Funders’ Forum, board member of the PAI Israel Climate Fund and sits on the advisory committee of the Value Squared Responsible Investment House.