Financial results are a downstream outcome. The true upstream driver is a company's culture—its talent density, hiring practices, and incentive systems. A strong culture creates a reinforcing feedback loop that attracts talent, improves decisions, and fuels compounding for decades.

Traditional finance is obsessed with drawdown depth (volatility, VaR). A more practical metric for long-term investors is 'submergence'—the total time from the start of a drawdown until the portfolio recovers to its previous high. This shifts the focus from immunizing against shocks to building portfolios that are resilient and recover quickly.

The 20th-century view of shareholder primacy is flawed. By focusing first on creating wins for all stakeholders—customers, employees, suppliers, and society—companies build a sustainable, beloved enterprise that paradoxically delivers superior returns to shareholders in the long run.

Instead of treating ESG as a subjective measure of corporate virtue, view it as a risk management framework. Its true value lies in identifying and quantifying material risks—like poor labor relations—that function as off-balance sheet liabilities, ultimately impacting a company's cash flows or discount rate.

To truly understand an investment's resilience, analyze its performance over a 20-year span, paying close attention to how it navigated major downturns like the dot-com bubble and the 2008 financial crisis. This deep historical analysis provides a clearer picture of stability than recent performance alone.

When challenged by an activist investor, Unilever demonstrated that its purpose-driven brands, like Dove and Hellmann's, outperformed others in its portfolio. They used hard KPIs such as pricing power, profitability, and pace of growth to prove that a strong purpose directly contributes to superior financial ROI.

The fund's core belief is that an impact lens can uncover economic returns unavailable to traditional investors. The strategy is not about sacrificing returns, but demonstrating that understanding impact benefits can directly translate into long-term economic outperformance, thereby influencing broader capital allocation.

Crossmark Global Investments' analysis reveals that while excluding sectors for ethical reasons causes short-term performance deviations, long-term returns (over 1, 3, 5, and 10 years) are comparable to unscreened portfolios. Strong fundamental analysis remains the primary performance driver.

A key indicator of resilience is not just surviving a stressful period, like a major product launch, but how quickly the team can recover its energy afterward. This "restoration time" is as crucial as performance during the event itself and is directly dependent on the resilience built beforehand.