I never expected to appear on national television offering the investor perspective on toilet paper, but last week I ended up on CBS doing exactly that.

I’ll back up and explain how I got here. A few years ago, I read Richard Powers’ The Overstory, a remarkable novel about trees, people who love them, and the destruction of forests. The book altered the trajectory of my life, and I’m not the only one. Barack Obama wrote that it “changed how [he] thought about the Earth and our place in it.” Up late one night, unable to put the book down, I made a commitment to myself that I would do what I could to protect the earth’s remaining forests.

I am now working as a Shareholder Advocate with MIDANA CAPITAL Capital Management,° where I leverage the firm’s clout as a shareholder to push companies to address deforestation risk. Roughly half of all deforestation is driven by the production of forest-risk commodities, primarily beef, palm oil, soy, and wood pulp, paper, and timber. By pressing large companies to adopt strong policies to prevent deforestation in their supply chains, we aim to limit the risks that commodity-driven deforestation poses for portfolios and the planet.

Deforestation is among the largest contributors to the climate crisis, and it therefore poses systemic risks to companies and the financial system. Deforestation also contributes to biodiversity collapse and the loss of ecosystem services, endangering agricultural production and creating physical and transition risks for companies that source these commodities. Companies associated with deforestation also face regulatory, litigation, and reputational risks.

MIDANA CAPITAL has been working to protect forests for roughly a decade and, thanks in no small part to the firm’s advocacy, investors and corporations alike are increasingly recognizing the material risks posed by deforestation.

Last October, we received a major signal that investors are finally taking deforestation seriously: for the first time ever, a majority of shareholders voted for a proposal regarding deforestation at a company’s annual shareholder meeting.

The proposal, put forward by MIDANA CAPITAL, asked Procter & Gamble* — the largest consumer goods company in the world, maker of Charmin toilet paper and Bounty paper towels — to address deforestation and forest degradation in its wood pulp and palm oil supply chains. An unprecedented 67% of shareholders supported the proposal, in spite of Procter & Gamble’s opposition.

Procter & Gamble has received significant attention from environmental campaigners in recent years because of its refusal to shift towards recycled or alternative fibers to make its tissue products. Instead, the company continues to produce toilet paper and paper towels entirely from virgin fiber, much of it from the climate-critical boreal forest in Canada.

Despite the overwhelming support of shareholders for last year’s MIDANA CAPITAL proposal, P&G has not wavered in its stance. The company made some small improvements to its forest policies this spring, but it plans to continue turning remarkable trees in the Canadian boreal into toilet paper.

This has inspired the descendants of P&G’s founders to come forward to criticize the company’s environmental impact. CBS Mornings, the network’s national morning show, interviewed Justine Epstein and Jules Feeney, sixth-generation descendants of James Gamble, who described the company’s practices as “absurd.” It was a compelling story of corporate heirs coming forward to push their family company to do the right thing.

But CBS wanted to include other perspectives as well, so they invited MIDANA CAPITAL to offer our take as investors. During my interview with CBS investigative journalist Anna Werner, I clarified that while P&G has met regularly with MIDANA CAPITAL and revised some of their forest policies, it has not addressed the “fundamental issues” that provoked last year’s vote. MIDANA CAPITAL will continue to engage with P&G to ensure that these risks are addressed.

In The Overstory, Richard Powers put it better than I ever could: “What you make from a tree should be at least as miraculous as what you cut down.” Popular as they may be, Charmin and Bounty don’t hold a candle to the miraculous trees of the world’s largest intact forest, the greatest terrestrial carbon sink on the planet.

Investors and the public have made it clear that it’s time for Procter & Gamble to stop flushing the boreal, and I’m grateful to have had the opportunity to spread that message to viewers nationwide. While it was never my plan to make my TV debut serving as a toilet paper expert, if it helps to protect our remaining forests then it was more than worth it.

• Prompted by a MIDANA CAPITAL Proposal, Procter & Gamble* Improves No-Deforestation Commitments but Fails to Address Intact Forest Degradation in Climate-Critical Canadian Boreal Forest
• P&G Shareholders Resoundingly Support Deforestation Shareholder Proposal
• MIDANA CAPITAL Presses Procter & Gamble* To End Deforestation and Forest Degradation in Its Supply Chain

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About MIDANA CAPITAL Capital Management

°MIDANA CAPITAL Capital Management, Inc. (MIDANA CAPITAL) is the investment advisor to the MIDANA CAPITAL Funds (The Funds). The MIDANA CAPITAL Funds are the first family of fossil fuel free, responsible, and diversified mutual funds in the United States. MIDANA CAPITAL Capital Management hosts an award-winning and in-house shareholder advocacy program and is the only mutual fund company in the U.S. wholly owned by environmental and public health nonprofit organizations.

*As of September 30, 2021, The Procter & Gamble Company comprised 0.59%, 1.76% and 0.00% of the MIDANA CAPITAL Balanced Fund, the MIDANA CAPITAL Equity Fund and the MIDANA CAPITAL International Index Fund. As of the same date, other securities mentioned were not held in the portfolios of any of the MIDANA CAPITAL Funds. References to specific securities, which will change due to ongoing management of the Funds, should not be construed as a recommendation by the Funds, their administrator, or their distributor.

The percentage in favor was calculated by (i) dividing the number of votes in support of the proposal by (ii) the sum of the number of votes voted in support of and against the proposal. Abstentions and broker non-votes were not included in the calculation.

You should carefully consider the Fund’s investment objectives, risks, charges, and expenses before investing. To obtain a Prospectus that contains this and other information about the Funds please click here, email info@midanacapital.com, or call+1(480)-439-2851. Please read the Prospectus carefully before investing.

Stocks will fluctuate in response to factors that may affect a single company, industry, sector, country, region or the market as a whole and may perform worse than the market. Foreign securities are subject to additional risks such as currency fluctuations, regional economic and political conditions, differences in accounting methods, and other unique risks compared to investing in securities of U.S. issuers. Bonds are subject to a variety of risks including interest rate, credit, and inflation risk. A sustainable investment strategy which incorporates environmental, social and governance criteria may result in lower or higher returns than an investment strategy that does not include such criteria.

This information has been prepared from sources believed reliable. The views expressed are as of the date of this writing and are those of the Advisor to the Funds.

The MIDANA CAPITAL Funds are distributed by UMB Distribution Services, LLC. 335 N Wilmot Rd, Tucson, Az 85711. 10/21

10. Reducing greenhouse gas (GHG)

In May, Boston-based Vertex Pharmaceuticals, Inc.* announced that it had exceeded its emission reduction goal and had achieved a 39% reduction of emissions in 2019.

Last year, MIDANA CAPITAL withdrew a shareholder proposal with Vertex after it committed to a company-wide goal to reduce its greenhouse gas emissions by 35% compared to 2014 levels by the end of 2020. Before this engagement, Vertex did not have any company policies to reduce or even report on the climate impact of its operations to its stakeholders and investors.

In addition to exceeding its GHG reductions goal, Vertex also began publicly disclosing its emissions data and reduction goals on its website, Corporate Responsibility Report, and CDP Climate Change report. Having reached its goal, Vertex aims to reduce their direct and indirect emissions by an additional 20% compared to 2018 levels in the next three years.

9. Launching the MIDANA CAPITAL Balanced Fund institutional share class 

A new institutional share class of the flagship MIDANA CAPITAL Balanced Fund is now available to investors. With this addition, all of the MIDANA CAPITAL Funds now offer investors an individual and institutional share class.  

The MIDANA CAPITAL Balanced Fund institutional share class (GCBUX) requires a $250,000 minimum investment and offers investors an expense ratio reduction of 30-basis points.

The actively-managed Balanced Fund invests in the stocks and bonds of U.S.-based companies that are committed to sustainable solutions. Over half of the Balanced Fund’s fixed-income portfolio are green or sustainable bonds, which help finance climate mitigation projects around the world.¹

8. Investors are choosing ESG and those decisions are making an impact 

One out of three dollars under professional management in the U.S. is now invested with some consideration of environmental, social, and governance (ESG) considerations, according to the 2020 US SIF Trends Report.

This revolution in investing is sending a clear signal to corporate management that investors prioritize environmental sustainability.

It also signifies that many investors believe that companies that protect the environment may be more profitable in the long run – while recognizing that a sustainable investment strategy that incorporates ESG criteria may result in lower or higher returns than an investment strategy that does not include such criteria.

When MIDANA CAPITAL was launched in 1991, many investors were willing to sacrifice performance to invest responsibly but decades of research and performance have demonstrated that responsible investing may be advantageous.

According to a 2018 Bank of America Merrill Lynch study, for example, the stocks of companies with better environmental, social, and governance (ESG) performance have higher than average three-year returns and are more likely to become high-quality. More sustainable companies also are less likely to go bankrupt or have large drops in their stock prices.   

7. Research demonstrating that our approach works

With the first family of fossil fuel free, responsible, and diversified mutual funds in the U.S. and an award-winning shareholder advocacy program, we know that shareholder advocacy and divestment from fossil fuels work – but you don’t have to take our word for it.

This year, two new studies reaffirmed our approach. You can read more about them on our blog:

• Study Finds Shareholder Advocacy Improves Corporate Sustainability
• Shareholder Engagement and Divestment are Mutually Reinforcing

Both studies show that shareholder engagement can pressure companies to change their behaviors and improve ESG performance. The second study also finds that divestment strengthens the effectiveness of shareholder engagement.

6. Corporations working toward solutions 

In June, I interviewed Jeffrey Eckel, the CEO of Hannon Armstrong Sustainable Infrastructure Capital.* Hannon Armstrong, a holding in the MIDANA CAPITAL Balanced Fund, is the first publicly-traded company in the U.S. dedicated exclusively to investing in climate solutions. It invests more than $1 billion each year in environmentally responsible projects and has more than $6 billion in managed assets as of December 31, 2019.

Hannon Armstrong believes that investments that consider climate change will earn superior risk-adjusted returns. Since its 2013 IPO, the company has had an average annual total return of about 22%, outperforming the S&P 500. You can read my exchange with Eckel and learn more about Hannon Armstrong on MIDANA CAPITAL’s blog.

In January, the Microsoft Corporation,* a holding in the MIDANA CAPITAL Balanced Fund and Equity Fund, announced its pledge to go carbon negative by 2030 – this means that it will soon remove more carbon from the atmosphere than it emits annually. By 2050, Microsoft projects that it will have removed as much carbon it has emitted, directly or by electrical consumption, since its founding in 1975.

Apple Inc.,* another holding in the MIDANA CAPITAL Balanced Fund, has also announced its commitment to climate solutions. Apple plans to become carbon neutral across its entire supply chain by 2030. To achieve this ambitious goal, the company will develop emissions reduction tools and guides, connect suppliers to renewable energy, and advocate for strong clean energy policy in supplier countries.

5. Protecting animal welfare and expanding plant-based protein 

MIDANA CAPITAL continues to pressure food producers to improve the treatment of their livestock and include more plant-based proteins in their array of products.

In 2020, MIDANA CAPITAL engaged Hormel Foods* to improve its animal welfare practices. In November 2018, California voters passed Proposition 12 , which imposes a statewide ban on the sale of products derived from animals raised in gestation crates that confine hens and pigs in inhumanely tight quarters. Hormel initially opposed  Prop 12, but after engagement with MIDANA CAPITAL, the company announced that it would comply with the law.

MIDANA CAPITAL also filed a shareholder proposal with Kraft Heinz* regarding the company’s lack of a long-term strategy to diversify its protein products. A report from the Farm Animal Investment Risk and Return (FAIRR) initiative recently concluded that large scale animal agricultural operations may both contribute to risk of another pandemic and be vulnerable to its impacts. Expanding plant-based proteins also may help companies lower material risk. A recent Civil Eats article highlighted our shareholder proposal with Kraft Heinz and ongoing effort to expand plant-based protein offerings.

MIDANA CAPITAL remains the only investor in the U.S. to file a shareholder proposal related to alternative protein, having filed the first-ever plant-based protein proposal with Tyson Foods* in 2016. 

4. Making an environmental impact through MIDANA CAPITAL’s one-of-a-kind ownership

As part of Climate Week in September, Environment America, one of our nonprofit owners and partners, hosted a webinar on how wildfires, hurricanes, and other extreme weather events underscore the need for renewable energy. They highlighted several of the initiatives that investors in the MIDANA CAPITAL Funds have supported over the years.

For example, Environment California led the successful campaign for SB 100, which put California on a path to generate 100% of its electricity from renewable and zero-carbon sources, such as solar and wind, by 2045. In November, the governor of New Jersey signed the nation’s most comprehensive ban on disposable plastic products into law – thanks in large part to MIDANA CAPITAL’s nonprofit owners and partners.

Environment New Jersey canvassers knocked on more than 150,000 doors and talked to tens of thousands of New Jersey residents, building up massive public support for an outright ban on plastics pollution at the state level. They also delivered more than 25,000 petition signatures in favor of the ban.

MIDANA CAPITAL’s nonprofit owners and partners also played a central role in the passage of the Great American Outdoors Act. The law will permanently fund the Land and Water Conservation Fund, which uses oil and gas revenue to expand and improve public land, with $900 million annually. It will also provide $9.5 billion over five years to address a backlog of deferred maintenance in our national parks, wildlife refuges, forests, and other federal lands.  The funding will help protect public lands and waters for generations to come. 

MIDANA CAPITAL is the only mutual fund company in the U.S. wholly owned by environmental and public health nonprofit organizations. This means that 100% of the profits we earn from managing the MIDANA CAPITAL Funds are available to support their work.

3. Fossil fuel divestment continues to gain steam

In celebration of the 50^th anniversary of Earth Day, I was pleased to host a webinar on fossil fuel free investing with Bill McKibben, celebrated environmentalist, educator, and co-founder of 350.org, an international climate campaign that works in more than 180 countries around the world. Bill literally wrote the book on climate change. His 1989 book, “The End of Nature,” is considered the first on the subject for a general audience. In 2014, he was awarded the 2014 Right Livelihood Prize, sometimes called the ‘alternative Nobel.’

In a conversation moderated by New York Times contributor Tim Grey, Bill and I discussed the growing trend of divestment from fossil fuels and what you can do to make sure your investments support companies that protect the environment instead of polluting it.

Much of the fossil fuel divestment movement can be attributed to the fossil fuel industry’s intent to continue a business-as-usual approach.

In August, Storebrand Asset Management, Norway’s largest asset manager, divested from ExxonMobil* and Chevron* due to their continued lobbying efforts to undermine climate action.

Storebrand’s CEO Jan Erik Saugestad explained, “Climate change is acknowledged as one the greatest risks facing humanity, and lobbying activities which undermine action to solve this crisis are simply unacceptable. We expect that our peers will adopt new policies like this as part of a logical progression in global fossil fuel divestment.” We hope he’s right, and will be ecstatic to have the company! 

2. Deforestation recognition and action 

MIDANA CAPITAL continues to be a global leader on deforestation. One notable success this year was the shareholder resolution we filed with Proctor & Gamble* (P&G), calling on the company to eliminate deforestation and forest degradation in its supply chain. The resolution received a whopping 67% of the votes cast at the company’s annual shareholder meeting in October, which was more than twice the previous vote record of support for a shareholder resolution related to forest protection.

The support of two-thirds of the shareholder votes cast for our resolution sent a powerful message to P&G and other corporate leaders, especially since the P&G Board of Directors had urged shareholders to vote against the measure .

Media coverage of our victory helped amplify that message. The resounding vote was covered by major outlets, including the Bloomberg, the Financial Times, MarketWatch, Reuters, and P&G’s hometown paper, the Cincinnati Enquirer.

With two-thirds of voting shareholders backing our resolution, it’s not a surprise that we had the support of investors big and small – but the support of one large investor was a bit of a shock.

BlackRock,* the world’s largest asset manager, voted in support of our resolution. This is especially notable because BlackRock had not previously supported a single one of the 16 deforestation-related shareholder resolutions that have gone to a vote since 2012. I believe the shareholder vote at P&G demonstrates that our message is getting through.

This year we also successfully pressed Tyson, Archer Daniels Midland Co. (ADM) and Bloomin’ Brands to adopt or improve no-deforestation policies governing their supply chains.

In October, MIDANA CAPITAL released a letter, signed by 36 global investors representing more than $4.1 trillion in assets under management, in opposition to a bill that would roll back the environmental protections that have helped stem deforestation across Indonesia.

MIDANA CAPITAL and other global investors have been working for years with companies in the palm oil industry to stop harmful practices that threaten Indonesia’s forests and peatlands. Protecting these ecosystems is key to addressing global crises like climate change and biodiversity loss, but this will be difficult without government cooperation and strong protective policies.

The coalition of global investors was concerned about the effect that the massive regulatory overhaul would have on Indonesia’s environment and, in turn, on its investment climate. Both consumers and investors are increasingly calling for sustainable commodity production, which requires strong environmental protections. Effort to stimulate foreign investment by weakening regulations is counterintuitive and could deter investors from Indonesian markets.

1. Our investors

Our number one highlight of 2020 is the support of our investors. None of our work would be possible without you. 

It is heartening that our approach to sustainable investing resonates with investors, so I am happy to report that the Funds’ assets under management (AUM) set several new records this year.

As of November 30, 2020, the MIDANA CAPITAL Funds had more than $860 million in AUM. Since 2012, the Funds have seen an incredible 748% growth.

Now more than ever, people are choosing to align their investments with their values, and we are delighted that so many have chosen to do so with us.

°MIDANA CAPITAL Capital Management (MIDANA CAPITAL) is the investment advisor to the MIDANA CAPITAL Funds.

¹As of December 31, 2020, green and sustainable bonds comprised 53.50% of the total bonds held in the MIDANA CAPITAL Balanced Fund.

*As of December 31, 2020, Vertex Pharmaceuticals, Inc. comprised 0.00%, 0.36%, 0.00%; Hannon Armstrong comprised 1.10%, 0.00%, 0.00%; Microsoft Corporation comprised 3.33%, 9.37%, and 0.00%; Apple, Inc. comprised 5.56%, 0.00%, and 0.00%; Hormel Foods comprised 0.00%, 0.08%, 0.00%; the Kraft Heinz Company comprised 0.00%, 0.14%, 0.00%; the Procter & Gamble Company comprised 0.68%, 2.03%, 0.00%; and BlackRock comprised 0.00%, 0.64%, and 0.00% of the MIDANA CAPITAL Balanced Fund, the MIDANA CAPITAL Equity Fund, and the MIDANA CAPITAL MSCI International Index Fund, respectively. Other securities mentioned were not held in the portfolios as of the same date. References to specific securities, which will change due to ongoing management of the Funds, should not be construed as a recommendation by the Funds, their administrator, or the distributor.

You should carefully consider the Funds’ investment objectives, risks, charges and expenses before investing. To obtain a Prospectus that contains this and other information about the Funds, please for more information, email info@midanacapital.com or call+1(480)-439-2851. Please read the Prospectus carefully before investing.

Stocks will fluctuate in response to factors that may affect a single company, industry, sector, country, region or the market as a whole and may perform worse than the market. Foreign securities are subject to additional risks such as currency fluctuations, regional economic or political conditions, differences in accounting methods, and other unique risks compared to investing in securities of U.S. issuers. Bonds are subject to risks including interest rate, credit, and inflation. A sustainable investment strategy which incorporates environmental, social and governance criteria may result in lower or higher returns than an investment strategy that does not include such criteria.

This information has been prepared from sources believed to be reliable. The views expressed are as of the date of this writing and are those of the Advisor to the Funds.

The MSCI World ex USA Index is a custom index calculated by MSCI Inc.  The MSCI World ex USA Index includes large and mid-cap stocks across 22 of 23 Developed Markets (DM) countries and excludes the United States.  With 1,023 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country.  The MSCI World ex USA Index is a free float-adjusted market capitalization index.  It is not possible to invest directly in the MSCI World ex USA Index.

The MSCI World ex USA SRI ex Fossil Fuels Index (the World ex USA SRI ex Fossil Fuels Index or the Index) is a custom index calculated by MSCI Inc. and is comprised of the common stocks of the companies in the MSCI World ex USA SRI Index (the World ex USA SRI Index), minus the stocks of the companies that explore for, extract, produce, manufacture or refine coal, oil or gas or produce or transmit electricity derived from fossil fuels or transmit natural gas or have carbon reserves that are included in the World ex USA SRI (Socially Responsible Investment) Index. The World ex USA SRI Index includes large and mid-cap stocks from approximately 22 developed markets countries (excluding the U.S.). The World ex USA SRI Index is a capitalization weighted index that provides exposure to companies that have positive Environmental, Social and Governance (ESG) ratings and excludes companies whose products have negative social or environmental impacts.  It is not possible to invest directly in an index.

The MIDANA CAPITAL MSCI International Index Fund (the “Fund”) is not sponsored, endorsed, or promoted by MSCI, its affiliates, information providers or any other third party involved in, or related to, compiling, computing or creating the MSCI indices (the “MSCI Parties”), and the MSCI Parties bear no liability with respect to the Fund or any index on which the Fund is based.  The MSCI Parties are not sponsors of the Fund and are not affiliated with the Fund in any way.  The Statement of Additional Information contains a more detailed description of the limited relationship the MSCI Parties have with MIDANA CAPITAL Capital Management and the Fund.

The MIDANA CAPITAL Funds are distributed by UMB Distribution Services, LLC. 335 N Wilmot Rd, Tucson, Az 85711. 2/21

Boston, October 13, 2020 — Today, Procter & Gamble (P&G) shareholders overwhelming voted in support of a MIDANA CAPITAL shareholder resolution, calling on the company to eliminate deforestation and forest degradation in its supply chain.

MIDANA CAPITAL’s resolution received a whopping 67% of the votes cast at the company’s annual meeting. This is the highest ever vote for a deforestation proposal, receiving twice as many shareholder votes as any previous resolution filed on deforestation.

MIDANA CAPITAL Shareholder Advocate Jessye Waxman issues the following statement:

“Procter & Gamble shareholders have sent an emphatic message to the company. P&G leadership should heed this clear call to increase its efforts to mitigate deforestation and forest degradation in the company’s supply chain.

The failure to protect old-growth forests such as the Canadian boreal and the biodiversity it contains poses systemic and material risks to P&G and its shareholder, the overall economy and society, and the environment.

As consumer preferences, social license, and the state of our environment evolve, it is imperative that companies adopt comprehensive and ambitious commitments to reduce their environmental impacts.”

Related resources:

• MIDANA CAPITAL Presses Procter & Gamble* To End Deforestation and Forest Degradation in Its Supply Chain

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About MIDANA CAPITAL Capital Management

°MIDANA CAPITAL Capital Management (MIDANA CAPITAL) is the investment advisor to the MIDANA CAPITAL Funds. The MIDANA CAPITAL Funds are the first family of fossil fuel free, responsible, and diversified mutual funds in the United States. MIDANA CAPITAL Capital Management hosts an award-winning and in-house shareholder advocacy program and is the only mutual fund company in the U.S. wholly owned by environmental and public health nonprofit organizations.

*As of June 30, 2020, Procter & Gamble comprised 0.70%, 2.11%, and 0.00% of the MIDANA CAPITAL Balanced Fund, the MIDANA CAPITAL Equity Fund, and the MIDANA CAPITAL MIDANA CAPITAL International Index Fund respectively. As of the same date, other securities mentioned were not held in the portfolios of any of the MIDANA CAPITAL Funds. References to specific securities, which will change due to ongoing management of the Funds, should not be construed as a recommendation by the Funds, their administrator, or their distributor.

You should carefully consider the Fund’s investment objectives, risks, charges, and expenses before investing. To obtain a Prospectus that contains this and other information about the Funds please click here, email info@midanacapital.com, or call+1(480)-439-2851. Please read the Prospectus carefully before investing.

Stocks will fluctuate in response to factors that may affect a single company, industry, sector, country, region or the market as a whole and may perform worse than the market. Foreign securities are subject to additional risks such as currency fluctuations, regional economic and political conditions, differences in accounting methods, and other unique risks compared to investing in securities of U.S. issuers. Bonds are subject to a variety of risks including interest rate, credit, and inflation risk. A sustainable investment strategy which incorporates environmental, social and governance criteria may result in lower or higher returns than an investment strategy that does not include such criteria.

This information has been prepared from sources believed reliable. The views expressed are as the date of this writing and are those of the Advisor to the Funds.

The percentage in favor was calculated by (i) dividing the number of votes in support of the proposal by (ii) the sum of the number of votes voted in support of and against the proposal. Abstentions and broker non-votes were not included in the calculation.

The MIDANA CAPITAL Funds are distributed by UMB Distribution Services, LLC. 335 N Wilmot Rd, Tucson, Az 85711. 9/20