The Investment Integration Project (TIIP) defines system-level investing as the intentional consideration by investors of the bigger-picture environmental, social, or financial system context of their security selection and portfolio construction decisions. The financial community relies on these systems for profitable investment opportunities and to maintain stable business operations and functioning financial markets.

First coined by Robert Monks and Nell Minow, “universal ownership” suggests that certain institutional investors have reached such size and scale that they own every industry, asset class, and geography in their portfolios, thereby owning the market, which is a reflection of the economy. As Jon Lukomnik and Jim Hawley note in their book, Moving Beyond Modern Portfolio Theory: Investing That Matters, the health of the overall market and economy affect an investor’s returns more than security selection or portfolio construction. If an individual investment results in negative externalities to the economy, and therefore the market, even if that produces a near-term return for that individual investment, it may not be in the interest of the investor’s portfolios.

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Reforming financial markets

to build more wealth

and influence

for workers

and communities

Investor Playbook for Employee Ownership in Sub-Saharan Africa

The Playbook highlights the potential of employee ownership to create more inclusive and resilient economies, particularly in emerging markets where wealth concentration and economic inequality remain pressing challenges from within and across countries.

Task Force on Inequality and Social-Related Financial Disclosures (TISFD)

As part of TISFD’s Working Group, PDI is working to develop recommendations and guidance for businesses and financial institutions to understand and report on impacts, dependencies, risks, and opportunities related to people.

Investing to reconnect financial value with people, nature, and the real economy

An iterative blueprint for capital market actors, policymakers, and regulators to explore how capital markets can play a transformative role in building a regenerative and inclusive economy by realigning financial value with real-world value.

“Getting Ahead of the Curve on Dynamic Materiality”

PDI partnered with Oxfam America and Omidyar Network on a new discussion paper that is designed to support U.S. investors and their investees in understanding how sharing more wealth and influence with workers and communities can correct market imbalances and support early identification and mitigation of emerging risks.

The Predistribution Initiative (PDI) is a nonpartisan, multistakeholder non-profit that works with investors and their stakeholders to improve financial analysis and investment decision-making processes in ways that more adequately value workers, communities and nature.

Sign up for PDI’s newsletter to stay up-to-date, and read more about our work below.

Efforts to date to make investment more responsible have primarily focused on portfolio companies, including their operations, products and services. However, little has been developed to assess and improve investors’ own activities, particularly regarding the allocation, pricing and structuring of capital. This gap means that risks to society and nature are not addressed systematically and effectively. 

Predistribution is an approach to addressing socioeconomic inequality and conservation that prevents risks to people and nature before they occur, as opposed to having to remedy problems after the fact. Predistribution offers a pathway to resilience, agency and less dependency on redistribution.

The pathway to advance a predistributive economy is through market reform, with input from workers and communities across the political spectrum. We hope you will join us!

How We Do This

We specifically focus on three overlapping and complementary workstreams, each involving research and co-creation with diverse stakeholders – including investors, workers, communities, policy makers and regulators, and academics.

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Measurement Management of practices Market and investment structures

“Reimagining Investment Structures”

“Reimagining Investment Structures” is a series of animated videos about the need to improve investment structures so that investors can align their internal investment governance and financial analysis practices with the principles of intergenerational fiduciary duty. Part one focuses on the issue of inequality and how workers have lost economic power due to the “labor squeeze.” Part two focuses on risks relating to existing investment structures, such as leveraged buyout strategies used by some private equity firms. Part three looks at the role that investors can play in building a better financial system by taking into account issues like fund manager compensation, financial engineering, and tax structures.

Part 1 — The Labor Squeeze: How Workers Are Losing Economic Power

Part 2 — The Potential for More Sustainable & Regenerative Investment Structures
Part 3 — Structuring Finance to Work for All Stakeholders