Archive for July 26, 2012

Climate Change and Big Carbon

Bottom Line:  Climate change signs are coming through stronger now than ever before, and faster than scientists anticipated.  The droughts in India and the US bode ill for food prices later this year, early next.  The suffering in poorer countries may cause additional deaths, social upheaval.  The economic interests of Big Carbon are working against our need to change.

Hot Enough for You?

Anecdotally, it’s been a hot summer.  My parents in Connecticut have talked about the 5 heat waves (3+ days of 90 degree+ weather) before August.  Anudip Foundation talked about “faculty that braved 45 degree Celsius (113F)  temperatures in stifling humidity [in India] to conduct their classes in remote places. Several suffered heat strokes in the process.”  Bill McKibben, in his Rolling Stone article marvels at Saudis’ report of “rain in Mecca despite a temperature of 109 degrees, the hottest downpour in the planet’s history.”  And that’s just the tip of the iceberg.  The rest of the iceberg (Petermann Glacier) broke off from Greenland, a mass of ice twice the size of Manhattan.  But maybe it’s OK, because one bigger than that broke off two years ago…  If you want something that’s unprecedented in 150 years, you can turn to this month’s ice melt of of the Greenland ice sheet, which overshot it’s “typical” level of 55% melting to go from 40% to 97% in 4 days.   Heat records have been broken left and right in the US, and the heat and drought has caused serious crop failure in key farming regions in the US 

“Some stuff technically is not going to be worth the combine bill to harvest it,” he said. “This is my 49th crop, and I have never had a year like this.”

In India, the story is similar:

“The situation is quite bad, exceptionally bad, and very serious for farmers,”  said scientist Kirpal Singh Aulakh, former head of Punjab Agricultural University in Ludhiana.

The Geo-Political Landscape for Change

(What follows is a summary of Bill McKibben’s Rolling Stone article.)

The weak consensus of the Rio+20 Global Summit was to maintain a temperature increase of 2 degrees (Celsius) or less.  Scientists believe this increase will cause a host of problems, but not be an existential threat to humanity and our way of life.  We have already seen a 0.8 degree increase, with associated problems (ice melt, droughts, oceans 30% more acidic). So some question whether even 2 degrees is permissible.  But no binding actions were taken to commit the largest emitters (China just surpassed the US) to any definite course of reduction.

Scientists have further estimated the amount of CO2 that could be released while still remaining within the 2 degree limit:  565 Gigatons by 2050.  According to the research cited in the article, on our current path, that level will be reached in about 16 years (adding 32 Gigatons per year, growing 3%).

Big Carbon (Big Energy)

The greatest source of the CO2 emissions is the burning of fossil fuels for energy (coal, oil, and natural gas).  The biggest energy companies (and, in countries where the state controls petroleum reserves, the states themselves) are sitting on known reserves that will exceed the 565 Gigaton limit 5 times over.  Yet in their quest for more energy (and to increase the $1 Trillion in profits captured since 2000), exploration for new deposits of carbon-based fuel continues unabated.  Indeed, with the easiest “finds” already exploited, the new sources (like tar sands or shale) require much more energy to extract, thereby increasing the effective emissions (and cost) of the “useful” energy.

So, while humanity ponders our existence, (or gets distracted by the latest celebrity gossip), the oil companies will also be pondering their existence, recognizing that if we (as a human race) were to enforce the 565 Gigaton limit, nearly 80% of the existing known reserves, plus whatever additional finds are made, could not be burned, rendering it essentially worthless.  Since the companies’ market value is derived from these assets and future earnings stream, any such limit would savage the value of the industry, possibly driving some of them out of existence.

If it’s a race to see who can organize faster to protect their interests to avoid being driven out of existence, all the signs so far point to the oil companies winning.

Postscript:  The Silver Lining?

A friend shared Matthew Ridley’s The Rational Optimist a couple years ago–the central thesis is that our inventive capability is providing for huge gains, and things that look grim today will be solved by technology or discoveries in the future.  Linear extrapolation misses the “disruptive game-changers.”  He argues that given a choice between a dollar of mitigation effort today and one (inflation adjusted) a hundred years from now, we should delay, and pay later, because our wealth and standard of living will have increased so much from discoveries between now and then.

I found his argument partially persuasive, but am still troubled:

  1. These environmental changes are happening faster than forecasted, and the effects seem to be more extreme than forecasted.
  2. Inventions not only impact our ability to make a positive difference; they also increase our capability to make a negative difference.  We’re more capable of making large-scale changes to our environment.  Yes, that may bail us out, but we also may miss a fatal flaw in our plan.
  3. The Big Carbon companies seem to be sticking their heads in the (oil) sands.  McKibben cites the lack of investment, even the shuttering of the alternative energy projects undertaken by the reigning corporate leaders.

So, yes, let’s be looking at inventions that might enable us to capture and sequester carbon.  Let’s look at alternative energies.  But let’s agree that our course of charging ahead, ignoring the warning signs and continuing “business as usual” is a foolhardy recipe for disaster.

Seven Tips for Organizing a Fulfilling Volunteer Experience

Bottom Line:  Volunteer projects over the last two days were a study in contrasts.  One very mental, one more physical.  Both fulfilling.  Seven things that they both got right to make it a good experience for me, the volunteer.

Ecumenical Hunger Program

Yesterday, I stopped by Ecumenical Hunger Program in East Palo Alto to ask about potential volunteer opportunities for groups.  They had an information sheet detailing different options, but they also needed help right now.  They were preparing for their monthly food distribution, and needed help splitting the pallets of groceries into boxes for the 80-100 families that would be showing up in a little bit more than an hour.  I offered to stick around, and was soon at work packing boxes:  2 large cans of pear halves, 3 smaller ones of peaches, 2 packs of tortillas, 4 smaller cans of apple sauce, 2 pound bags each of rice and pinto beans, a 64-oz bottle of spiced cranberry juice,  a half-gallon of milk, a 2 pound bag of pre-washed salad, a watermelon and a cantaloupe.   Other groups were packing meats (not sure of all that went into it, but looked to be a dozen eggs, a one-pound pack of hot dogs, a one-pound tube of ground sausage, and 2 1-pound packs of cold cuts (baloney or ham).  A third group was packing fruits and vegetables.  This being summer in California, there was a nice selection of nectarines, oranges, broccoli, corn, onions and probably more that I didn’t see.

At 5 PM, not only was the distribution done, but the area had been restored to its prior, clean state.  Empty boxes were gone.  The leftovers were in the food pantry.  The tables were taken down and stored, and the parking lot had been swept.  It was a remarkable display of efficiency, taking the volunteer efforts of probably a dozen people, some of us first-timers, and getting a large task done in a short time.  Staff members Suliana and Jackie deserve credit for getting us all together to get everything done.

 Helping with a Grant Application

Monday afternoon, I spent about 2 hours helping out with the final submission of a grant application to the USAID.  The Principal Investigators for the submission had put together a nice response to a Request for Proposals, one that could have real impact for students and others in Africa.  They needed a fresh set of eyes to help them simplify the writing for people who weren’t already familiar with what they’re proposing.  So I helped cut some of the excess verbiage and clarify things a bit.  We used Google Docs, with two or three of us editing the same document at the same time, with the shared goal of clarifying it and squeezing the word count down to fit in the allotted number of pages for the proposal.   We were all at our own desks, miles apart, just communicating through the edits we were making to the document and the chat window alongside.  Yet here again, the process converged and we finished expediently, and had a chance to chat a bit before going our separate ways.


On the face of it, the two experiences were very different:  one very physical, the other totally mental; one where I was in the same place with the other volunteers, and even got to help the beneficiaries directly (e.g., loading a car) whereas in the other I interacted only through typing; in one case, just about anyone could have done what I was doing, in the other, it required a high skill level of writing, background knowledge, and a understanding of an “academic setting.”  But at the end of the day, each of the experiences was very satisfying.  I attribute that to:

  1. There was a clear objective.
  2. We managed to finish what we set out to accomplish.  (It was a manageable amount of work.)
  3. The project leaders were “in it together” with us, helping out in a visible way.
  4. The project leaders were appreciative.  Very much so.
  5. There was a sense of teamwork: we could see what other people were doing, how we were all contributing toward the goal.
  6. We had the tools we needed for the job:  we were able to use our time effectively, and weren’t forced to wait around much.
  7. There was space for a little off-task fun.  Kidding around a bit, cracking jokes in the chat window, taking a group break to re-hydrate.  We were definitely driven to finish things quickly, but it wasn’t “all work, all the time”.

Ultimately, I found the grant writing more fulfilling–the ability to use my skills in a way that not many others could do, plus the chance that it would have a very large impact (helping to win a grant that I thought will make a positive change, in a more enduring way).  But I was happy with my EHP experience, too.  By following the seven tips above, each project made me feel like a valuable and valued volunteer.

Cover letters that prove you’re not a flake

Yesterday, a friend asked for feedback on a cover letter she was preparing.  She’s a recent grad from Stanford, with an incredible passion for eliminating homelessness, and a track record of achieving impossible things.

That got me thinking about cover letters in general.

I’ve heard from several volunteers that they’ve offered their services to an organization they wanted to help, and then never heard back.  You’d think that should never happen, given the clear needs of nonprofits and the fact that people are offering something for free, but it can and does, most commonly because:

  • The offer went to the wrong person in the organization
  • The organization is not well set up to handle volunteers
  • The person you sent it to is too busy
  • Too many volunteers have been “flakes” and you’re lumped in with them

What goes into a good cover letter

A cover letter offering to volunteer isn’t that different from a cover letter applying for a job.  You need to:

  1. Convey your competence
  2. Convey your passion
  3. Outline the terms of the proposed engagement
  4. Give them a way to follow up

Busy, Busy!

Nonprofit people are, like the rest of us, busy people.  (Read “The ‘Busy’ Trap” Tim Kreider’s NY Times opinion piece if you haven’t…) So, help them out by:

  • Keeping the letter short, with everything they need in it (OK to attach a resume, but the letter should make your case on a stand-alone basis)
  • Proving you’re not a flake by showing you’ve done your homework on them

Excerpt from Giving Back on Approach Letters

Approaching the Organization as a Volunteer

Nonprofit staff members are busy people, and they may see your offer to help as more of a burden than blessing. Many cold calls that organizations receive result in their having to spend more time to assess, train, and coordinate the prospective volunteers than those volunteers give back before losing interest. You can help demonstrate you’re serious about your intended commitment by doing your homework first, and sending a well-written approach letter answering their key questions. If you can be introduced by someone who is already a friend to the organization, that’s even better. An impressive introductory letter will answer:

  • Why did you choose this cause and this organization?
  • What impressed you most about the organization?
  • What interactions have you had with the group so far?
  • How much time do you have? When?
  • What unique skills do you have?
  • What would you most like to do to help? Are there specific people or projects that sound most intriguing? (You may not get your first choice, or be able to work directly with the person whose biography you saw on the website, but these expressions of interest will help them match you up.)
  • Who does the organization know who knows you?
  • What’s the best way to reach you?
  • Do you intend to involve children in your volunteering? What are their ages?

Including a donation check along with your inquiry about volunteering is a sure way to be taken seriously.

A Sample Approach Letter

As if opening a time capsule, I was able to find an approach letter I wrote in 2004 to James Dailey, then the project manager for the Grameen Foundation’s project developing open-source software for microfinance. Although the URL to my background and interest is no longer active, the letter itself is a good example of an approach leading to a fruitful collaboration. I volunteered hundreds of hours that year for Grameen, using my technology background to help them write requirements documents and conduct an evaluation of software development firms.

From: Steve Ketchpel  
Sent: Friday, October 08, 2004 3:56 PM
To: James Dailey
Subject: MFI open-source software
Hello James,
 You’ve been recommended to me by a couple of different
 people: Peter Bladin and Robert Sassor. I’m starting a yearlong
 project at Stanford, and am interested in helping MFIs to scale through
 technology. From my research so far, it seems that back-office
 portfolio management software is a key step to increasing the capacity
 and attracting new capital (through securitization).
 I’ve seen the moap project (though haven’t had a lot of time to
 dive into all the details), and it looks like it hasn’t really attracted
 the critical mass of developers needed to make progress. I’d like to
 speak with you to see what your plans are relative to efforts in this
 Peter mentioned that you were going to be in Uganda for a couple
 weeks, so perhaps we can schedule some time when you return?
 A brief background on the project & on me can be found at
 If you have recommendations on people to speak with or resources
 that I should review in the meantime, I’d welcome the pointers.
Steven Ketchpel, Ph.D.
Reuters Digital Vision Fellow
Stanford University

Approach-Letter Exercise

Take the elements on the list preceding the sample letter, and craft an approach letter to your proposed organization. See if you can find the email address or direct phone number of the volunteer coordinator or executive director of the organization. If you’re ready, send your message and set events in motion for a fruitful giving-back partnership.

Book launch: T-1 month

Bottom Line:  I think the book should be out within a month.  I’m really excited–initial readers have been very positive.  I could use your help with a few decisions on the cover, and also with promotion.  If you could introduce me to journalists or others who could help spread the word, I’d definitely appreciate it.  I’m also considering whether to do a book launch tour, and would welcome suggestions for cities (better still, venues) I should come visit.

Things are coming together!

I got word today that my submission for cataloging to the Library of Congress had been approved.  I’d mentioned I was excited about the cover, so here it is!  The awesome pictures were taken by Jason Koenig of when he was on a trip with Construction for Change to visit their project in India building a Hospital for Hope, created by Stanford students and profiled in the book.  The picture of me was taken by my thesis advisor Hector Garcia Molina.

I have a few questions that I’d like your feedback on:

Title in Orange

Title in Blue

[polldaddy poll=6378084]
[polldaddy poll=6378088]

The quotes are still coming in, but so far:

Giving Back is exemplary in presenting solid how-to information that shows prospective volunteers and philanthropists how to chart a path that leads to personal satisfaction while doing good in the world.

— Bob Graham, Founder and CFO of Namaste Direct

Anyone who is serious about giving, or who wants to teach kids to be lifelong givers, should read Giving Back. I often find myself wanting to give, but I’m not always clear on how best to do it. Giving Back is a practical primer for moving from heart to hand. Not only does it provide great strategies and activities for effective giving; it also leads you through the process of creating a giving game plan. I came away from the book feeling both inspired and equipped to up my giving game.

— Paul Lamb, Nonprofit Consultant and Social Entrepreneur

Giving Back
starts families down the path of volunteering. The book is an invaluable guide for finding how you can contribute your time, unique skills, and money to effective organizations making a real difference. No matter what age your kids are, you’ll find excellent ideas for involving them in your giving or doing volunteering together. This book suggests ways to create great family experiences and memories by doing good together!

—Perla Ni, Founder and CEO, GreatNonprofits

Ketchpel’s Giving Back is the perfect guide for families who want to learn to volunteer and give together – with the details you’ll need to tailor expectations for any age level to engage in meaningful service. The magic of volunteering comes to life with captivating accounts of service and learning to inspire family conversations and plans. Giving Back models these Listening and Learning Conversations to help your family create the scaffolding for a family culture of reciprocity and connectedness – one that will nurture skill-building in children, and foster autonomy, responsibility and motivation in teens. Share this insightful book and change the world – one family at a time!

– Leif Erickson, Executive Director, Youth Community Service

Help with Promotion

After spending a year of my life writing it, I want to make sure that Giving Back doesn’t land with a thud, number 38,121,786 on the Amazon list.  So, yes, I’d love to get your help with promoting it.  A self-published work has an extra challenge (hard to get reviews published, e.g.) so I’d welcome your ideas and connections on how to break through.

  • Can you suggest / introduce journalists, bloggers, or other notable people who would be interested in learning about Giving Back and potentially sharing it with their audience?
  • What websites should I be sure to send the announcement to?
  • Both within and beyond the Bay Area, where should I go to do events (probably more like a 2 hour workshop/seminar than just a signing, but format still TBD)?  Do you know people who might like to help host/organize an event there?  Or have a suggestion for a venue I could contact?
  • How else should I prepare for the launch?
Add a comment or drop me an email to

Thank you!

LIBOR-fixing Scandal

Last Monday, I learned about the fraud around municipal bond dealings by major US banks and financial institutions (my blog entry about the original Rolling Stone article).  It was a pretty big deal, and left me disappointed with the state of ethics among the financial institutions, individual bankers who benefited personally and corporately and the management that permitted it.  I thought that it would be the  “once-in-a-decade” level misdeed, or perhaps even a “Watergate” moment that catalyzed the demand for punishment and reform.

I was wrong.

As I was praising Matt Taibbi for his work in uncovering and reporting on this, he (along with others) were digging up the details of a larger, more pervasive racket, whereby some (perhaps “many” or maybe “all”?) of the 16 largest banks charged with setting the LIBOR (London Interbank Offered Rate) were lying on their rates in order to make a greater profit or to appear to be in a stronger position than they actually were.  Barclays is the first bank to admit wrong-doing, and faces a $450 Million fine.  It is almost certain that other banks will be blamed as well.  The “misdeed of the decade” didn’t even hold the record for two weeks.

The LIBOR is a base rate upon which many financial products ($360 Trillion worth, according to the articles) are priced.  These include credit card rates and some mortgages–things that impact end consumers.  But beyond that, financial institutions have the responsibility to behave in accordance with law and regulations, and the type of manipulation carried out here is inconsistent with trust-worthiness.  What does it mean when banks cease to be trustworthy?

John Gapper, in an editorial in Financial Times called “Trading Floor Culture No Longer Acceptable”,  castigates the “if-you-don’t-get-caught-it-isn’t-wrong” mentality that seemed to have been rewarded in the banks’ trading operations, the breeding grounds for the current crop of chief executives.  He suggests:

An obvious start would be to clear out the investment bankers who now run universal banks… They may be honourable individuals but, as a group, they symbolise the relentless ascendancy of the securities trading floor.

“It would be a very good thing if an awful lot of people lost their jobs in a lot of banks,” says one former bank executive. “Not because I wish them ill but because only by making many examples will you get through to people that this is a very important business.”

He goes on to note that such an outcome is unlikely, given the entrenchment of such forces, their embedded nature in “too big to fail” institutions, and their being “remarkably immune to shame.”

Self-regulation appears not to be working.  The existing government regulation appears not to be working (in a timely fashion–these events appear to date back to 2005).  While $450 million sounds like a lot of money, Barclays made $9.1B in 2011, so the fine amounts to less than a nickel on each dollar of profit, for just one year, when it sounds like the larceny went on for five or six years.  We need greater accountability within the financial segment.  I favor a return of the Glass-Steagal act.  And maybe our legislators need a subscription to Rolling Stone to keep up with the latest financial investigative journalism.

Mission-Related Investing for the Rest of Us: Equity-like Assets (Part 5 of 5)

Bottom Line:  Investing for growth is much harder in the impact world.  Crowd-sourced equity investments are coming, but aren’t an adequate substitute for index mutual funds or ETF’s.  Local/social equity investments are best viewed as similar to private equity: a small fraction of a diversified portfolio, willingly taking  a higher risk to chase a higher return.  (Remembering here, that the “return” is a combination of financial and social.)

Mission Related Investing for the Rest of Us series:

  1. Part 1:  Motivation  (Using your investments to earn a “social,” values-based, return as well as a financial one)
  2. Part 2:  Background & Investing Theory (Where I’m coming from, and how I used to think about investing)
  3. Part 3:  Banking and Cash Alternatives
  4. Part 4:  Bond-like Alternatives
  5. Part 5:  Stock-like Alternatives

How I currently invest in equities (mostly)

As I mentioned in Part 2, my belief in the Efficient Market Hypothesis means that I’m not trying to “beat the market” with my stock picks, and instead, I choose the cheapest way I can get the very broadest exposure possible, (the Vanguard Total Market Index ETF, (VTI)).  That’s about as far from favoring my local community as possible.

Socially Responsible Investing

The basic level of making sure that your stock investments line up with your values is ensuring that you aren’t invested in companies whose business or business practices you find objectionable.  Advisors tend to talk about “screens” for alcohol and tobacco, but other industries like military/defense, mining, or companies that have engaged in questionable financial practices or exploitation of their customers (pay day loans, e.g. or the “too big to fail” banks that steered minorities into mortgages that were not the best fit/rate for which they were eligible.)

There are mutual funds that perform this research and ensure that their holdings meet the criteria described in the prospectus.  See, for example, the list maintained at

Going beyond the “negative screens”, you can proactively choose to invest in sectors that you feel will pay off for society if they succeed.  Alternative energy investments are an example here, and the socialfunds list includes them as well.  The returns over the recent history have not been pretty–make sure you are comfortable that the money you are investing can be subject to the risk that is inherent in these investments.

“HIP” Investing

R. Paul Herman has coined the term “HIP” investing to talk about “Human Impact + Profit” investments.  While his writings cover the whole spectrum of this 5-part series, (he’s excerpted his book in a 25(!) part series on Triple Pundit), the focus is on equity investing, and finding companies that will excel based on their commitment to key values:

  • Health
  • Wealth (generating it for the customers)
  • Earth
  • Equality
  • Trust

Within each of these values, he lists demonstrable metrics, and provides a scorecard for rating companies and benchmarking industries.  (A lighter-weight “HIP Check” is available for free on their site.)  Herman’s thesis is that abiding by these values offers a competitive advantage, and therefore, companies that score well on the HIP metrics will also outperform financially.  He connects the dots for some of the examples, showing how the savings in reduction of waste accrue to the bottom line, and compares the return of the HIP fund against two others (a “vice” fund and a socially responsible fund) for a 5-year period ending June 2009, and shows that it has the highest return of the 3.  This was an especially volatile period, so is perhaps not the best to extrapolate from, but worth noting his results.


Since equity  investments tend to be riskier and harder to evaluate, the government tries to protect prospective investors.  The laws requiring security registration and prohibiting the advertising of unregistered securities do provide protection, but they also greatly limit the opportunity for smaller companies to raise equity capital.  Generally, a company can sell unregistered securities only to “accredited” investors (those with a net worth of $1M+, not counting their primary home, or annual income of $200K+ individual, $300K+ married), or a small number of “friends and family.”  But here again, the combination of risk and low-deal flow makes investing in these types of deals (often called “angel investing”) are appropriate only for a small portion of your portfolio, more akin to lottery tickets than the average growth upward over time of an investment in the broad market indices (and re-investment of dividends, which makes a big difference when compounded over the years.)


One aspect of the investing landscape that is changing with the passage of President Obama’s JOBS acts is the permission of companies to raise a moderate amount of capital (up to $1 million) without registering the security.  There will be limits on the amount that individuals can invest per year, and it remains to be seen how it will be implemented (the SEC is supposed to propose rules by January 2013), but there is some chance that it will transform equity raising for small companies in the way that Kiva has transformed fund raising for microcredit.  There are certainly plenty of companies that would like to be the platform upon which such investments are made.  Realistically, though, with the limits and uncertainty, crowdfunding isn’t a feasible investment vehicle today, and won’t be for some time to come.

Update:  Here’s a nice blog status report on the SEC process by Crowd Check: