George Washington: Impact Investor in Chief

James Keck MBA ’24

TFC Social Innovation Strategy Chair 2023 – 2024Social Innovation Strategy Chair MBA '24

This year, I finally read Washington: A Life, the erudite biography by Ron Chernow. Chernow paints a colorful picture of President George Washington – one almost feels the founding father’s scowling presence 250 years later. Like most MBAs, I spend a considerable amount of time thinking about leadership. What does it mean to inspire a team? How does one find the balance between compassion and complicity when someone stumbles? In these questions, I frequently reflect on Chernow’s portrait of Washington to imagine how such a leader would answer.

Recently, I’ve begun to reconsider the opus from a new perspective: Washington as America’s first prolific impact investor. I recognize such a comparison risks torturing both sides of the analogy, though I hope you’ll acknowledge the merit in the opposition.

Briefly, impact investing is the allocation of capital with the stated objective of generating measurable social and environmental returns alongside financial returns. More importantly, it is the acknowledgment that financial gains are life’s necessity, not its purpose. For this purpose, we must aim higher. We must pursue acts that leave our world better than we found it. It is from this viewpoint I begin my thinking around Washington’s role as an impact investor.

Clearly, in a unique position, I believe Washington exhibited indications of both social and environmental impact investing, albeit detached from the strict definition we place upon the terms today. Almost all of Washington’s energies, both private and public, considered the lasting impact of his actions and leveraged his influence and capital for improved social conditions for American citizens. Similarly, the first President recognized the intrinsic value of the land, exhibiting ecological stewardship in his investments.

Throughout his career, Washington focused on building long-term economic value and aligned this with social impact when possible. In the world of landed men, Washington was born with little. However, he consistently placed financial bets on various opportunities (primarily land speculation with surveying); he was a born prudent capitalist. Post-revolutionary war, a mad dash for land in the Ohio River valley led many Americans to subsume Native American land illegally. Recognizing the value of the land and the intractability of the American settlers, Washington purchased land from Native Americans to restore balance to inequity pressed upon the native peoples. Though he consistently – even aggressively – sought returns on his investments, Washington operated within moral bounds. For example, he refused to profit from wartime speculation, bounding his industrious nature within a compass of social good. As president, Washington advocated for the rights and welfare of average citizens and workers, not just the landed elite, which earned him no admiration from his contemporaries. Summarily, he invested capital (public and private) into infrastructure projects that brought commerce and opportunity to the colonies. Yet, beyond the capital, Washington invested decades of his life into improving the social conditions of American citizens. Given his unique position as the nation’s patriarch, his time provided a scope of impact so foundational, that I willingly conflate his time and capital investment under the same umbrella. Thus, I argue that we can consider Washington an early semblance of a social impact investor.

We should also consider George Washington’s bent on ecological preservation within his investments. Washington’s work to balance progress with sustainability at Mount Vernon is exemplary. For example, he pioneered new farming techniques like crop rotation to prevent soil exhaustion, actively seeking to preserve the land and his profits. He perceived himself as a steward of his land, pursuing commercial success without destroying Virginia’s natural bounty. At one point, Washington became enthralled by an inventor who had designed a boat that would travel upstream. The President saw an opportunity to increase commerce in Virginia without the ecological harm of building dams.

Washington’s insistence that economic gain should be pursued concomitant to social and ecological uplift was unique in his time and eminent position. His prudent blend of financial, social, and environmental objectives makes him an early pioneer of impact investing. Washington’s vision provides a model of pursuing progress with purpose. It is a legacy we at the TFC continue. We deploy capital and time into ventures with the express purpose of creating a more just and sustainable world.

A final note: Washington’s legacy is darkened by his stance on slavery. Chernow addressed this head-on by acknowledging it as a damning flaw while mollifying his supporters with a nuanced depiction that shows dimensionality in this aspect of his character. I’m not nearly qualified enough to comment, but I felt that not acknowledging the point would be negligent.