The Value(s) Advantage

Business creates profits, ideally, by creating value — for customers, and for employees and society at large. But business can also create profits by taking value, by doing harm rather than good (tobacco, gambling, strip mining, etc.) Eventide invests, for reasons of both ethics and returns, in companies who are superior at creating value. And we have no interest in “profits by plunder” from companies whose products and practices display a willful disregard for their harmful outcomes. Instead, our investing philosophy is firmly rooted in our vision for the great capacity of business to create value and, thereby, a better world.

But value(s)-based investing* is not just about better investing ethics, its about better investing returns. Companies who excel at creating value, in turn, excel at growing both sales and earnings. That’s not just our hope, it’s the compelling conclusion of a major study by Bain Consulting published by Harvard Business School Press.**

The opposite is also true. Bad profits can be quite profitable, for a time, but there is always a day of reckoning. (The meltdown in shareholder value for companies involved with subprime mortgages is a dramatic case in point.) Good profits, by contrast, come from companies whose value-creating activities are self-sustaining over the long-term. Eventide invests in these businesses. In so doing we enlarge their capacity to create still more value — including for our shareholders. For our companies, and for our investors, it is truly an opportunity to “do good by doing well”.

* For a more thorough discussion of Eventide’s investing philosophy, read A Value(s)-Based Approach to Investing.

** Fred Reicheld, The Ultimate Question, Harvard Business School Press, 2006.

Please note that the Fund’s ethical screening criteria limit the potential universe of investments and could cause the advisor to avoid investments that, at least in the short term, may perform well in other funds.