Newday CEO Doug Heske.
Newday is a rarity among digital advisors. The robo-advisor, which launched over the summer, is not only focused on marrying sustainable investments to a digital platform, which others have done, but also, in the words of CEO Doug Heske, engaged in "recrafting the idea of capitalism" beyond shareholder capitalism, which dominates today.
"The world is demanding a different form of capitalism that we're defining as new capitalism, making business decisions …. that are in the best interests associated with employees, customers, shareholders and the environment," Heske tells ThinkAdvisor.
"Companies that rate high in all those variables tend to have a lower cost of capital and superior financial performance," says Heske. (Numerous reports support both, including reports by Oxford University and Arabesque Partners and by Morningstar.)
Newday Co-Founder and President Alex Meek adds that if companies are not taking care of employees and investing in them and not investing in their suppliers and supplier relationships, those "contingent liabilities," which don't show up on the balance sheet immediately, eventually will, impacting performance.
Newday President Alex Meek.
Newday differs from most other robos in other ways as well. Including its:
- Current availability on mobile apps for IOS and Android phones only (but it's planning to introduce a web-based application for laptops and desktops in April)
- Plans for a socially responsible checking (debit card only) and savings account, also set to debut in April, though investors can sign up now
- Equity investments in individual stocks only, not funds or ETFs
- No minimum investment policy
- Easy access to lists of portfolio holdings
- Heavy emphasis on financial education, available under the "Learn" tab on its website and through its collaboration with the SIFMA Foundation for The Stock Market Game in which students compete to create a best performing portfolio of stocks, bonds and mutual funds
These and other attributes of Newday reflect its primary audience: 25- to 35-year-olds who want to align their financial life with their social values but don't necessarily have the knowledge or expertise to do so.
