Is It Prudent to Be Responsible? The Legal Rules for Charities That Engage in Socially Responsible Investing and Mission Investing

Fiduciaries who invest assets held by a charity must act as prudent investors. This Article examines the legal rules that apply to these fiduciaries, examining the duty of loyalty and the duty of prudent administration for trustees of charitable trusts and directors of nonprofit corporations. The Article focuses on the duty to act as a prudent investor and the question of whether a charitable fiduciary can consider the charity\u27s mission or purpose when making investment decisions. Recent developments in the laws that regulate investing by fiduciaries provide guidance, and the Article concludes that these rules permit consideration of a charity\u27s mission as one of many factors a prudent investor considers. The Article briefly examines the history of socially responsible investing, reviews the development of mission investing, and discusses three types of socially responsible investing: screens, proxy voting, and community investing. Recent data show improvements in the returns of screened funds and increased interest by charities in mission investing. Fiduciaries must exercise care and judgment in making investment decisions, but mission investing can meet the legal standards that apply to fiduciaries as long as the fiduciaries act with prudence

Probate Definition of Family: A Proposal for Guided Discretion in Intestacy, The

Intestacy statutes may not match the wishes of many people who die intestate. Changes to the Uniform Probate Code (UPC) include or exclude potential takers, as the drafters attempt to bring the UPC provisions closer to the intent of more intestate decedents. As the UPC tries to fine-tune the intestacy statutes, however, family circumstances continue to get more and more complicated. Families headed by unmarried couples, blended families with children from multiple marriages, and families in which adults raise children who are not legally theirs, have become commonplace. For some decedents, non-family friends and caregivers may be more important than legal relatives. Given the diversity of decedents\u27 family structures and wishes with respect to their property, constructing an intestacy statute based on fixed rules has become ever more problematic. This Article examines the UPC\u27s treatment of the family in the intestacy rules and looks at provisions from other state intestacy statutes. The Article analyzes the definitions of spouse and child and identifies problems created by the current definitions. The Article reviews some of the many proposals for intestacy reform, especially those that advocate a degree of judicial discretion. After discussing provisions in the UPC and a few state statutes that already permit judicial discretion, the Article proposes an intestacy statute that provides a relatively simple default rule for inheritance and permits judicial discretion, exercised within a framework of statutory guidance, to determine the proper distribution of an intestate\u27s property

The Greatest Heritage is the Love of a Family: The Larson Case and the Mediation of Probate Disputes

In 1981, two brothers, Ben and William Larson, began litigation that would last for four years. By the time the lawsuit ended, the winning brother was dead, and the other brother was bitter and estranged from the family of his only sibling. Although one can only speculate, had the brothers chosen mediation, rather than litigation, to resolve their dispute, both brothers might have achieved a better outcome

Best Interests in the Long Term: Fiduciary Duties and ESG Integration

Two persistent misconceptions continue to affect the way fiduciaries think about sustainable investing: (1) fiduciary duties block a fiduciary investor from considering environmental and social factors; and (2) the portfolio will suffer financially if a fiduciary investor engages in sustainable or responsible investing. An examination of socially responsible investing; ESG integration (an investment process that considers material environmental, social, and governance (ESG) factors alongside traditional financial metrics); corporate social responsibility; and impact investing, shows that neither of these assumptions is correct. Analyses of different forms of sustainable investing have found no necessary cost to a portfolio when sustainable funds are compared with traditional funds. The SEC already requires companies to report material information, and reporting standards developed by the Sustainable Accounting Standards Board (SASB) and the Global Impact Investing Network (GIIN) are improving understanding of the financial materiality of ESG factors. Given the development of new financial products and strategies, fiduciary duties require examination. The duty to act as a prudent investor is of central importance to anyone acting as a fiduciary, and the available data explain why a prudent investor should consider ESG information. Moreover, since the duty of impartiality protects future beneficiaries, that duty requires a long-term investment time horizon, increasing the need to take ESG information into consideration. It follows that a prudent fiduciary investor not only may, but should, use ESG information in developing financial policy and decisions

Identifying Barriers to Forage Innovation: Native Grasses and Producer Knowledge

Adoption of native warm-season grasses (NWSGs) in the tall fescue belt is limited despite studies documenting the potential contribution of these forages to profitable beef production. On the basis of two surveys conducted in Tennessee, a survey of beef producers and a survey of agricultural professionals, we evaluated perceptions of NWSG forages and how those perceptions could influence their adoption. Although agricultural professionals were more familiar with NWSGs than producers, both populations had limited knowledge regarding these forages, indicating that additional Extension education is needed. Our results provide useful guidance for developing NWSG forage educational programs for producers and agricultural professionals

Contemporary Trusts and Estates - an Experiential Approach

In this essay in a special issue dedicated to teaching trusts and estates, the co-authors of Contemporary Trusts & Estates: An Experiential Approach (2d. ed. Aspen 2014) reflect on how the teaching of trusts and estates can integrate policy, practice, doctrine, and centuries of tradition. They describe the genesis of their problem-based casebook and the influence of the Carnegie Report on their choice of pedagogic framework. Each of the co-authors embraced the fundamental principles advocated by the Carnegie Report, which counsels that legal education should integrate “theoretical and practical legal knowledge and professional identity.” This essay goes on to outline how the book incorporates a problem-based methodology as well as an innovative choice of ordering the chapters that tracks the chronological path of estate planning, addressing the lifetime use of trusts first, followed by issues of will validity and interpretation. Drafting exercises complement the problems as well as traditional cases that illuminate theory and practice. With chapters on planning for disability, the federal estate and gift tax, estate administration and charitable trusts as well as basic doctrine on intestacy, wills and trusts, the book reflects the contemporary challenges addressed by trusts and estates lawyers. The co-authors have found that the book’s innovative approach engages students in a way that makes the study of trusts and estates relevant and students practice- aware