Stories from the Field: Eric Glass

You started Clarion Call Capital three years ago after over two decades at a large investment management and research firm, where you developed a successful municipal impact investing strategy. How does the work you are doing now more directly serve the needs of underserved communities?

Clarion Call Capital makes investments to reduce disparity in infrastructure focused on communities that are under-resourced and excluded. We provide greater agency and autonomy to engage more deeply and creatively about environmental and social issues that influence people and place. 

Clarion Call Capital is also working to disrupt the staid municipal bond market by creating a replicable, non-extractive direct-lending facility for municipalities, driven by frontline communities. Our goal is to create a scalable, deep place-based investing model for poor communities.

Walk us through your analysis. How do you decide which issuers qualify, and how does your ESG review shape what you invest in?

Our initial analysis identifies underserved and excluded communities. For example, we invest in health care systems that have more than 20 percent of their gross payer mix coming from Medicaid or charity care. We invest in colleges and universities where at least 40 percent of full-time, first-time students receive Pell Grants. For those entities that meet the socioeconomic criteria, we evaluate environmental, social, and governance (ESG) factors through an inquiry that we present to the individual issuer. 

Why do you see fixed income and municipal bonds as a more powerful and overlooked tool for impact than public equities and private markets?

Historically, the municipal tax-exempt bond market has been foundational to high-net-worth investors seeking tax-free income at the federal and state levels. If shifted to incorporate impact, the municipal market becomes the original impact investment. 

Clarion Call Capital believes a municipality’s overarching purpose is to defend and uplift the well-being, dignity, and opportunity of its citizens. Through the municipal bond market, we are able to center the human right to affordable housing, health care, clean water and sanitation, mass mobility, and education in state-of-the-art facilities for communities that have been excluded and discriminated against. There are very few investments one can make where they look out the window and point to a school or a hospital and say, “I helped build that. I contributed to the transformation of this community.”

You participated in the Milken Institute's Financial Innovations Lab^® roundtables on investing in cancer prevention, early detection, and diagnosis. Cancer is not typically the first issue people associate with impact investing. What drew you to this work, and why do you think it belongs in that conversation?

I attended Milken’s Financial Innovations Lab on cancer prevention given my role as a board member of the 90-10 Institute. The nonprofit is working to establish a public benefit biotech and life sciences ecosystem that prioritizes patient well-being over profit maximization and financial engineering. 

Beyond the 90-10 Institute, I believe in the importance of municipal impact investments as a financial tool for good that can help mitigate structural inequalities in health care, including cancer disparities. This means evaluating the efficacy of health-care investments through the lens of racial and social justice and community well-being.

What was one insight you took away from the Financial Innovations Lab conversations that has influenced how you think about social investing instruments—including, perhaps, the potential for cancer-related bonds?

In many instances, we’ve been led to believe the only way to finance complex and gnarly problems is through convoluted Rube Goldberg-like financial solutions. The municipal bond market is an efficient and, dare I say, elegant asset class that can raise large amounts of scalable, low-cost capital to address social, health, and environmental issues of the day, including efforts to cure cancer. 

The specific community impact issues investors focus on seem to change every few years. What do you think investors should be paying attention to regardless of what's currently in the spotlight?

Investors, municipalities, philanthropy, and grassroots organizations must be laser-focused on addressing climate resilience and adaptation within the built environment. More importantly, without immediate recognition and action, the most severe, acute, and disruptive impacts of climate change will fall disproportionately upon the health and well-being of the poor and Communities of Color.