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Cultivating Mindful Investment in Holistic Health

Independent Study

Joanne S. Ott

Masters of Arts in Holistic Health Studies

May 2012

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Introduction

This research paper is about cultivating mindful investment as a tool to grow the holistic

health infrastructure. I investigated the socially responsible investment (SRI) tools of

microfinance and impact investing, to understand the basic principles of these types of mindful

investments; I also explored if they are readily utilized for a holistic health agenda, and why it is

significant to grow the infrastructure for holistic health medicine. The integration of mindful

investment in holistic health medicine intertwines the fields of finance and holistic health, and to

explore a shifting mindset (worldview) in both disciplines that is melded together.

The first part of this paper touches on the context and lenses with which my background

and experiences have influenced me about this topic. The next section demonstrates the

importance of growing the infrastructure for holistic health medicine. Following this section,

mindful investment is defined by explaining the basic principles of microfinance and impact

investing. The fourth sections touches on similar examples of mindful investment in holistic

health medicine that my research uncovered. The final part touches upon the implications of this

research for holistic health medicine.

Context and Lenses

My background and experiences set the context for this research. My research focus is

the result of seeds planted long ago that reflect my many experiences. These experiences have

influenced me and color the lenses in which my perspective on this topic is put forth. It is

important for the reader to understand this perspective to fully grasp my purpose of integrating

mindful investment in holistic health medicine.

The first part of this section touches on my underlying desire for social justice and how

this has influenced my perspective on holistic health medicine and the economic business model.

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The next part explains my professional background in behavioral finance, which influences my

mindset in this area. The final part of this section demonstrates my underlying motivation in the

advocacy of holistic health medicine. Pulling together these experiences set the context and

lenses for this research topic and helps the reader understand my perspective.

Social justice passion. My first exposure to holistic health medicine was at Afya-Centro

Holístico da Mulher (Women’s Holistic Health Center), where I studied holistic health medicine

in Brazil. Afya’s philosophy was to teach individuals to find and tap into their own healing

power they carried within themselves; an empowering concept that is in contrast to my

experience with conventional allopathic medicine, where the doctor sets out to heal the patient.

Much of Afya’s philosophy in how they operated the women’s center was infused by liberation

theology and Paulo Freire’s critical pedagogy. I had lived in Brazil for almost six years as a

Maryknoll Lay Missioner and had worked in various areas of the social movements that

promoted and practiced these methodologies. Liberation theology and critical pedagogy call

upon the individual to tap into their own wisdom and to be empowered by their own conscious

awareness – something that Freire believed was central to human nature. Therefore, Freire’s

conscientização, or the process of becoming consciously aware, is a process of becoming fully

human, not just a philosophy of education.

I found my entire experience in Brazil weaved together multi-disciplinary concepts that

forced me to become consciously aware of things I had never interconnected before in my life. I

had begun to birth a deep process of my own conscientização. I was looking through different

lenses back at my U.S. culture and realizing the web of connections to social, political, and

economic systems across the world. I was no longer in my protective bubble and I was seeing

how the U.S. influenced the world from multiple platforms.

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In 2003, I attended the World Social Forum in Porto Alegre, Brazil. The World Social

Forum is attended by people worldwide who are seeking social change and addresses the ills of

the neoliberal system (capitalism) that was embedded in the fabric of the U.S. Culture, which

greatly influences world economies, often in negative manners. I had the privilege to sit in a

stadium full of over 100,000 diverse individuals to listen to Noam Chomsky speak about the

empire in his speech entitled - Life after Capitalism, or just Life. His message was earth

shattering for me to hear. He emphasized with great reserve and to be literally true if the

capitalistic institution continues the way it is going, the species on earth will cease to exist. I too

have come to believe what Chomsky conveyed to be profoundly true and view this reflected in

much of the ills of our world today. During my experience in Brazil, I have witnessed first hand

the destruction of the Amazon forest at a dangerous global warming tipping point, which has

occurred with the encouragement of World Bank financing and under the premise of laissez-faire

– privatization and less government regulation. During my time in Brazil, I observed how Brazil

withstood immense pressure from the U.S. attempting to pass the Fair Trade Agreement of

America (FTAA) on a country already burdened with infrastructure issues and further shackled

by World Bank debt. There was nothing fair about the FTAA for Brazil – it was one-sided

towards economic benefit for the U.S.

Living outside the U.S. and looking through different lenses allowed me to become

consciously aware of how the U.S. has mastered the business model to the extent that the drive

for further progress is at the expense of our own well-being. Capitalism, which was originally a

tool of economic prosperity, became solely focused on the end-result of profit, ignoring all

consequence of its predatory actions. The profit equation has almost entirely wiped out

consideration for humanity and sustainability. To change this system I realized more than ever

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before society needs to become aware of the destructive side of a neolibralism model that they

have also become enslaved within themselves and that a change in mindset is required.

Keeping in mind Chomsky’s speech, I have closely watched the Arab Spring and world up-

risings, especially the Occupy Movement in the U.S. To me, the Occupy Movement is an out

growth of over 10 years of the World Social Forum that has taken place each year in January

during the same time the World Economic leaders convene. This spring I attended a local

meeting that hosted eco-feminist Starhawk who is visiting major Occupy Movements across the

U.S. to do empowerment trainings. According to Starhawk, it is difficult to know when a

movement will take roots to change the mindset of the greater population, however we seem to

be at a critical tipping point with so much social, political, and economic unrest. At this meeting,

a local activist pointed out something deeply important - “There is no peace, because you can’t

make money on peace.” I reflected upon a similar analogy about the tremendous growth for

organic foods was partly fueled widespread evidence demonstrating the benefit of organic foods

and thus the general population began to be economic supporters as a result of this research.

Similarly, this same trend is happening with non-GMO foods – research has demonstrated the

possible ill affects of GMO foods and consumers are now requesting non-GMO foods at the

grocery story. Therefore, it appeared to me that mindset can be tipped based on sound research

that the pubic supports. With the analogy of peace, if research could demonstrate the science

behind peace then the general population would change their behavior to make it economically

feasible to create peace. A cycle of research influences behavior that influences economics.

Grounded in behavioral finance mindset. My previous professional career was in the

field of finance, where I hold my Chartered Financial Analyst (CFA) in the area of research

analysis and portfolio management. The firm I had worked in San Francisco at Fuller & Thaler

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Asset Management, focused on exploiting market inefficiencies through behavioral bias in the

stock market. The investment models developed at this firm were based on the research work of

Richard Thaler, a behavior economist, that was created from groundbreaking studies completed

by Daniel Kahneman in the field of psychology and economics. In general, investors do not

always act in rational ways, providing systematic ways of exploiting their behavioral biases. For

example, humans are prone to various heuristic behaviors that are hardwired in their brains,

creating opportunities to capitalize upon this through investment strategies. In working in the

area of behavioral finance, my career in finance focused on pushing towards a different mindset

in the investment management field, of which challenged the principles of finance theories that

depended upon the belief that investors are innately rational. Later in this paper I will touch on

how a change in mindset in the finance field is intricate to growing the infrastructure for holistic

health medicine.

Advocacy for holistic health medicine. Synthesizing together my learning’s from the

graduate program in Holistic Health Studies, invokes advocacy for a new healthcare paradigm

that is in contrast to many aspects of the allopathic medicine. Allopathic medicine does not

touch upon the whole system of healing – body, mind and spirit. The grounding foundation for

holistic health is to advocate a different mindset about healing and disease. One example of a

differing mindset that is necessary to move science forward in understanding the influence of

consciousness and the healing process was demonstrated at a recent conference I attended in

Madison entitled, Final Passages: Research on Near Death & the Experience of Dying. The

conference presented research on NDE and altered levels of consciousness and presented

numerous situations of this phenomenon that challenges the conventional scientific view of a

materialistic relationship between the brain and consciousness. Researching this phenomenon to

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further understand altered states of consciousness has implications to how we live and prepare

for the dying process. Near the end of this particular conference, the two central issues that

surfaced were about changing the scientific mindset and creating funding sources for the study of

consciousness. There is widespread view that research will not be funded until the public

accepts the study of consciousness and other ways of knowing. In light of addressing these

surmountable issues of funding and mindset, a participant at the conference stated, “What can

science do? Learn how to quantify life.” This statement infers that “money rules the world” -

thus here lies the dilemma where a changing mindset in both the fields of healthcare and finance

is necessary.

In inspirational leader in the field of microfinance, Muhammad Yunnas, who challenged

the banker’s conventional mindset, recently stated in a video, “What kind of world is this…

should we leave everything to the decisions of the profit maximizer’s so that their benefit decides

the world… or is there something else to bring in?” (Yunus, 2007). Thus, similar to how Yunus

has approached funding for a specific area, I believe a change in mindset will make it

economically feasible to grow the holistic health medicine infrastructure through mindful

investment. The following section demonstrates the case for such investment.

The Importance of Mindful Investment in Holistic Health Medicine

This section covers various reasons that support mindful investment in holistic health

medicine. The first part touches on the conundrum of holistic health medicine – which points to

the underlying issue of mindset and funding. Tremendous demand has increased for

complementary and alternative medicine (CAM), yet funding is still minimal. The next part

looks at issues relating to the effectiveness of allopathic medicine and the underlying issue of

iatrogeneis, or illness caused by doctors. The next part covers the shifting mindset towards

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holistic health. Following this part is the widespread cost containment issues that conventional

allopathic medicine is facing and the possible cost savings of CAM treatments. The final part

explains the trend to multi-disciplinary focus and how the mindset in the finance and holistic

health medicine are becoming linked.

All these issues are intricately linked to the importance of growing the holistic health

medicine infrastructure. Keep in mind in reading each of these sections I suggest that a cycle

exists, of multi-directional pathways that are both concrete and transparent, that connect funding

to research, which is linked to consumer behavior, that drives what is put in place as medical

practice or to what is implemented based on research (See figure 1). This cycle is multi-

dimensional and is non-deterministic to which point is the starting point. Thus in some cases it is

the research the drives the process and other times it is the consumer behavior. However, each

carries an influence that can also impact the mindset for holistic health medicine and therefore

can influence the growth of mindful investment in this area. This is not explicitly defined in the

research, at least that I know of, however it a process I have intuitively come to envision as a

basis to grow the infrastructure for holistic health medicine.

Figure 1

HolisticHealthMedicine

funding

researchapplication&practice

consumerdemand

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The conundrum – mindset and funding. Increased consumer demand for holistic

health medicine has grown significantly, yet funding still remains limited by the National

Institute of Health (Saputo & Belitsos, 2009). As an allopathic doctor in his book, A Return to

Healing: Radical health care reform and the future of medicine, Len Saputo (2009) explains the

trend in use of CAM treatments is due to several factors: the dissatisfaction of Americans of

treatments that are non-personal; treatments are generally invasive and lacking in success of

healing chronic disease; and the rising cost in healthcare has excluding more and more people,

while in contrast CAM treatments tend to be affordable. Another allopathic doctor, James Le

Fanu, M.D., acknowledges in his book, The Rise and Fall of Modern Medicine suggests the

reason for at least one-third of adults now using one or more CAM treatment is because “The

surging popularity of these alternatives might be explained by the undivided attention and the

physical manipulation offered by its practitioners which, to many, might seem preferable to

being expensively over-investigated and over-treated in a hospital bed” (1999, p. 356). In fact,

both these medical doctors point out that CAM visits out weight conventional primary care

physician visits by approximately 10% in 1990 and as much as 63% in 1997 (Le Fanu, 1999;

Saputo & Belitsos, 2009). The public seems to trust in CAM therapies despite the lack of

clinical trials that routinely test for efficacy in the medical field (Le Fanu, 1999). Certainly a

conundrum of sorts is reflected in this situation considering the lack of funding in holistic health

medicine.

The National Institute of Health formed the National Center for Complementary and

Alternative Medicine in 1992 with the purpose of providing the public rigorous investigation of

CAM treatments and considering the growth in demand for such treatments (NCCAM, 2007).

NCCAM was funded with $2 million its first year of 1992 (NCCAM, 2007) and funding has

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risen to only $128 million in 2011 (Saputo & Belitsos, 2009). This is shockingly low and

equates to less than 1% of the National Institute of Health (NIH) funding of allopathic medicine

(Saputo & Belitsos, 2009). In 2007, NCCAM reported that approximately 40% of adults are

using CAM treatments (NCCAM, 2007). It is estimated that the actual use of CAM increases to

62% when you include prayer for health reasons (Saputo & Belitsos, 2009). Dr. Saputo (2009)

even suggests that the actual use of CAM may in fact be substantially higher than what was

published in the 1998 landmark report published in JAMA by Harvard Medical School’s David

Eisenberg, M.D. where only 70% of individuals disclosed their use of CAM. Furthermore it is

interesting to note that one of my MAHS colleagues interviewed a holistic nurse at the Mayo

who told me that it was not until 2002 when the results from a survey reported that 69% of Mayo

clients did in fact use CAM, that the Mayo decided to begin clinical research and offer CAM to

their own clients. If anything will make a difference, economics will be in the driver’s seat. Dr.

Saputo estimates conservatively that the U.S. is spending over $30 billion a year on CAM

services (Saputo & Belitsos, 2009).

Even though the NIH acknowledges CAM treatments through the NCCM it is believed

they are anchored to the allopathic paradigm by limiting the scope in funding research and have

typically focused on yielding data about herb or supplements that can then be exploited by the

pharmaceutical industry (Saputo & Belitsos, 2009). The scale seems to be greatly lopsided

towards an allopathic medical model. In 2008, the NCCAM budget spent most of the $121

million on herbal research, yet this is astonishing less than what is typically spend on

pharmaceutical promotion – for example the pharmaceutical drug VIOXX spent $195 million for

advertising its destructive drug that produced negative side affects (Saputo & Belitsos, 2009).

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Iatrogeneis of allopathic medicine. Illness caused by doctors is defined as iatrogenic

disease (Illich, 1977). Just the same, Medical students are taught the allopathic oath “First, do no

harm” – a quote from the infamous philosopher Hippocrates (Saputo & Belitsos, 2009). Ivan

Illich, a philosopher and Catholic priest renown for his critique of Western medicine, in his book

Medical Nemesis (1977) with a barrage of statistics argues that modern medicine has reached a

stage where it has become a major threat to health, the iatrogeneis of allopathic medicine, and

that there is the illusion that this form of medicine is the cure-all. There seems to be an

assumption that increased budgets for medical treatments, including the medicalization of

symptoms, is thought to be directly linked to an increase in curing disease, and which will follow

with greater demand is all an illusion of the allopathic medical mindset (Illich, 1977; Le Fanu,

2002; Saputo & Belitsos, 2009). There exists the perception that without modern medicine we

would all be dead (Illich, 1977). This is not to discount the achievement or advancement in

medicine that have eliminated epidemics such as polio, tuberculosis, diphtheria, but rather the

philosophy of medicine still clings to the illusionary promise of creating defenses against either

the invading microbe (The Social Theory of medicine) or lack of genetic or biological defenses

in the body (Illich, 1977; Le Fanu, 2002; Saputo & Belitsos, 2009).

This begs the question about the efficacy of allopathic medicine. James Le Fanu, MD

(2002) sees a sort of irony that has evolved in Western medicine - as society has become

healthier, there is greater demand for more medicine, thus the medical establishment finds itself

driven to medicalize and diagnosis normal states of health, and also there is tremendous pressure

from the pharmaceutical industry to uncover more treatable illnesses. The Atlantic Magazine

(2010) published a report about the misconception of medical research that challenges the

established view that evidence based studies are reliable based on the extensive research of Dr.

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John Ioannidis, who has spent his career in exposing misleading and exaggerated findings in the

field. This article reported Dr. Ioannidis findings that:

His model predicted, in different fields of medical research, rates of wrongness roughly corresponding to the observed rates at which findings were later convincingly refuted: 80 percent of non-randomized studies (by far the most common type) turn out to be wrong, as do 25 percent of supposedly gold-standard randomized trials, and as much as 10 percent of the platinum-standard large randomized trials. (Freedman, 2010, p. 80)

This is alarming considering that medical practice is dependent upon medical research. While

the assumption might be that medical doctors will wise-up to bad research as evidenced by lack

of improvement from their patient treatments, this is not necessarily the case as reported by the

article:

The field is appropriately conditioned to subjugate such anecdotal evidence to study findings. Yet much, perhaps even most, of what doctors do has never been formally put to the test in credible studies, given that the need to do so became obvious to the field only in the 1990s, leaving it playing catch-up with a century or more of non-evidence-based medicine, and contributing to Ioannidis’s shockingly high estimate of the degree to which medical knowledge is flawed. That we’re not routinely made seriously ill by this shortfall, he argues, is due largely to the fact that most medical interventions and advice don’t address life-and-death situations, but rather aim to leave us marginally healthier or less unhealthy, so we usually neither gain nor risk all that much. (Freedman, 2010, p. 85)

Most interesting is how this article suggests that the risk now exists more than ever before for

the funding of medical and drug research – that purports to attack disease or uncover the magic

pill – in that the wider public has a change in mindset about conventional medicine, in realizing

the disillusionment of medical research findings, and in some cases may be turning to CAM

treatments as alternatives as compared to the invasive treatments of conventional medicine

(Freedman, 2010).

Shift in mindset towards holistic health. For over a century research data analyzing

disease has generally proven that it is the environment that largely influences health and wellness

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and conventional allopathic medical practice can not be accredited as the deterrent of disease

(Illich, 1977). This is an important distinction in that allopathic medicine has been specifically

designed to focus on fighting off diseases, assuming most causes are the result of external

invading microbes, which is based on outdated beliefs from nineteenth-century scientists such as

Pasteur (Saputo & Belitsos, 2009). While our health and well being are still influenced by

external microbes in our environment, another century old scientist, Beuchamp, argued against

Pasteur’s assumption of the cause of disease instead rationalized that it is our internal biological

defenses, when out of balance, make us more susceptible to disease (Saputo & Belitsos, 2009).

These are two contrasting medical approaches for defining and treating disease. In addition, a

majority of people fails to recognize that modern medicine still does not understand the causes of

most chronic diseases and does not address the preventative side of such diseases (Saputo &

Belitsos, 2009). The same medical philosophy that yielded marked advancements in preventions

of epidemics has not produced the same results in the area of chronic diseases, such as cancer

and heart disease (Le Fanu, 2002). Instead, Dr. Saputo advocates for a different medical model

that supports an integral health medicine mindset – “hybrid approach focuses on the premise that

the body itself does the healing and the medicine should support this process as its top priority”

(Saputo & Belitsos, 2009, p. 73).

It is noteworthy to mention that a majority of the world’s population still depend on

ancient healing methodologies that have centuries of observations and teachings – a mindset that

still exists today outside the allopathic medical model (Saputo & Belitsos, 2009). Western

medicine is at a tipping point and is slowly turning to cutting edge biomedical research in areas

that have been traditionally ignored because of the allopathic medical model dependence on a

reductionist and materialistic focus are now emerging, such as in the fields of

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psychoneuroimunology, bioenergetics, epigenetics (Saputo & Belitsos, 2009). This is pushing

exploration into other frontier areas that critically study the role of consciousness and the healing

process, such as the fields of neurotheology (Henion, 2012). For example,

psychoneuroimmunology studies psychosomatic illness that is the connection of our emotions

and thoughts that can lead to illness (Saputo & Belitsos, 2009). Neurotheology is concerned

with how our health, both body and mind, are influenced by our belief system – research that

studies the lack of illness of Tibetan Buddhist monks compared to other people is valuable to

understanding this phenomenon (Henion, 2012).

Allopathic medicine does not recognize the power of our belief system, especially

considering the placebo effect that is routinely set as the control in evidence based medical

research (Saputo & Belitsos, 2009). The placebo effect is presumed to have no value in

allopathic medicine and ignores evidence of the power of our consciousness. Indigenous healing

techniques have long been found to use some form of placebo therapy, yet the biomedical model

generally considers such therapy as unethical (Saputo & Belitsos, 2009). None-the-less, there

are a growing number of medical doctors, as much as 45% based on one study, who believe in

the mind-body connection and are using placebo therapy in their practices (Saputo & Belitsos,

2009). Dr. Saputo argues that the biggest resistance to mind-body concepts are for reasons that

are still greatly influenced by the pharmaceutical industry. He uses the example of the

pharmaceutical drug Prozac to treat depression, a condition that is widespread. Over 20 million

people take the drug Prozac to treat depression, which has only a 59% effective rate and is linked

to extensive side affects, where in contrast the evidence is ignored whereby the placebo is

effective 28% of the time without any side affects (Saputo & Belitsos, 2009).

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Cost containment and holistic health medicine. There is widespread perception that

the current allopathic medical model is costly, unsustainable, and tends to ignore preventative

measures that could provide for much needed savings in medical treatments that are avoided

down the road (Illich, 1977; Le Fanu, 2002; Saputo & Belitsos, 2009). Yet the NIH allocates

less than 5% of its budget for prevention and wellness, while a majority of its medical research is

funded in areas that produce costly, and in many cases ineffective treatments (Saputo & Belitsos,

2009). Illich (1977) argues that some of the most expensive medical procedures have no proven

effect. Furthermore, it is viewed that the allopathic medical model has developed into what

appears of doctors supporting their credibility through the administration of a limitless medical

tests and procedures that falsely suggest their importance (Illich, 1977; Le Fanu, 2002). This

dysfunctional model is further compounded with the pharmaceutical industry’s underlying drive

for profit. Dr. Le Fanu argues:

The dynamic force of progress of the post-war years, capitalism, as represented by the pharmaceutical companies whose ‘obsession with the new ‘exerts a very different, but equally destructive, influence on contemporary medicine. The reason for this ‘obsession with the new’ is obvious enough as new drugs, and the prospect of windfall profits while they remain under paten, are the life blood that drives the industry forward. This worked very well in the years of cornucopia, but when the rich stream of accidental drug discoveries began to dry up, the drug companies have had to resort to other means to maintain their profitability. (2002, p. 363)

Theses arguments suggest that the dependence of invasive medical treatments and

pharmaceutical drugs of modern medicine may have surpassed its peak and the need for cost

containment may be the driving force in the medical field for the future.

At present, healthcare in the U.S. comprises as much as 17% to 20% of GNP and this is

the largest sector of the economy, which is over double the amount that other developed

countries spend on health (Saputo & Belitsos, 2009). Outside of what might be considered

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iatrogenic deaths, the U.S. has the highest level of deaths that could be prevented as compared to

all industrialized countries (Saputo & Belitsos, 2009). Often, the U.S. medical system is viewed

as the premier medical model of the world. This alone is astonishing considering the U.S. level

of spending is so high and given the fact that the World Health Organization (WHO) ranks the

U.S. healthcare system at 37th (Saputo & Belitsos, 2009). Smaller less developed countries are

ranked higher than the U.S. and the U.S. is not even ranked in the top ten of the world’s

healthcare systems (Saputo & Belitsos, 2009). Both of these facts are disturbing and should be

enough to alarm North Americans with regards to the state of our healthcare system. The time

has come for a change of mindset in our allopathic medical model and healthcare reform is

inevitable. In Dr. Saputo’s book this imperative for radical reform is reflected in President

Barack Obama’s statement:

The crushing cost of health care … now causes a bankruptcy in America every 30 seconds. By the end of the year, it could cause 1.5 million Americans to lose their homes. In the last eight years, premiums have grown four times faster than wages. And in each of these years, one million more Americans have lost their health insurance. It is one of the major reasons why small businesses close their doors and corporations ship jobs overseas. And it’s one of the largest and faste-growing parts of our budge. Given these facts, we can no longer afford to put health care reform on hold. (Saputo & Belitsos, 2009, p. 211)

The drive for increased medical innovation from the allopathic medical model is unsustainable

(Illich, 1977; Le Fanu, 2002) and advancement will need to come from alterative methods that

provide cost savings (Saputo & Belitsos, 2009). Dr. Saputo sees the eventual end the allopathic

model whereby “the structure of disease care is too often wasteful, counterproductive,

inefficient… compromised by corporate influence… and lethal” (Saputo & Belitsos, 2009, p.

214). Ultimately we are moving towards an integral medical model of preventative care that is

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“radically reforming its flawed systems of research, regulation, financing, and delivery” (Saputo

& Belitsos, 2009, p. 213).

Cost containment is a big part of the 2010 Affordable Care Act (ACA) and recently

Ezekiel Emanuel, the former presidential healthcare adviser, challenged the conventional

wisdom of progress through further medical innovation, by stating to an audience at the

University of Minnesota:

Industry needs to quit thinking of innovation only as new pills and devices. Instead it needs to find new ways of tracking patients’ health, reducing medical errors and hospital readmissions, and incorporating information technology into medicine to reduce costs. (StarTribune Editorial, 2011)

In conjunction with the ACA, the Center for Medicare and Medicaid Services (CMS) is

attempting to create innovative ways of cost containment through Accountable Care

Organizations (ACO) that function towards the goals of improved healthcare for individuals,

within populations, and with slower growth of medical expenses through efficacy of care

(Infenix, 2011). Not wanting to miss an opportunity, healthcare insurance giants such as United

Healthcare are entering the market promoting services that assist healthcare institutions meet the

ACO standards that will be established (Infenix, 2011). Ingenix, United Healthcare’s subsidiary

branch, which focuses on research and the impact of the ACA, acknowledges outright that there

is considerable consensus that the current healthcare system is flawed and unsustainable, further

expanding:

Costs are too high and quality of care is inconsistent due to a complex array of factors including practice variation, defensive medicine, fraud and abuse, a fee-for-service system (FFS) that pays for volume, lack of accountability by all stakeholders for the health an health care costs of individuals and populations. (Infenix, 2011, p.2)

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United Health Group recently published a survey of over 3400 physicians and patients that

clearly suggests that consumers are wanting more preventative measures in their healthcare and

healthcare institutions are seeking ways to contain medical costs further down the road that have

become prohibitively expensive, including linking the efficacy of treatments to compensation

(United Health Group, 2011). Therefore, the unsustainable cost of allopathic medicine may be

the underlying motivation that will stimulate growth of the infrastructure for holistic health

medicine.

Considering the passage of the 2010 Affordable Care Act with its emphasis on

preventative care and cost containment, Dr. Saputo sees the possibility for research funding for

comparative assessment of treatments that would include CAM approaches, and thereafter the

mandating of the treatments (both CAM and allopathic) that are found more cost effective

(Saputo & Belitsos, 2009). This seems a logical initiative considering the unsustainable nature

of allopathic medicine. In fact there are a few studies worth mentioning that attempt to

demonstrate the cost effectiveness and efficacy of holistic medicine. One example is a

controlled study that used the integrative medicine approach and found significant cost savings

for total medications of ontology patients admitted at Beth Israel Medical Center who utilized a

variety of treatments such as yoga therapy, holistic nursing, and provided a healing environment

(Kligler, Homel, Harrison, Levenson, Kenney, & Merrell, 2011). This study quantified the

overall daily cost savings of $156 per hospital day per patient for a total of 89 patients in the

study that received the integrative medical care as compared to the 74 patients in the baseline

group (Kligler, et al., 2011). According to this study considering the total hospital stay, “total

mean medication costs were significantly higher for the baseline group ($889) than for the

[integrative medicine] group ($420), for a cost savings on average of $469 per patient” (Kligler,

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et al., 2011). Another evidence-based study that provided a Holistic System of Care over a ten-

year period treating Native Americans in an urban environment demonstrated effectiveness in its

focus on treatment, prevention, and recovery for their community (Nebelkopf & Wright, 2011).

Because of the organization’s model and documented efficacy they were able to secure funding

from several state agencies and they had other counties who adopted their Holistic System of

Care (Nebelkopf & Wright, 2011).

A third example is research that reviewed several studies that measured depression before

and after Emotional Freedom Techniques (EFT), a non-invasive method, using random

controlled trials (RCT) for 8-weeks of EFT demonstrated significantly and clinically reduced

levels of depression from this RCT study (Church, 2011). The study reports that according to the

National Institute of Mental Health, the cost of treating depression alone in the U.S. exceeds $83

billion annually (Church, 2011). In addition, this study argues that there are many indirect costs

to such psychological problems, such as loss of work and the future medical ailments that

develop linked to such conditions and should also be factored in (Church, 2011). With 53% of

the U.S. population estimated to be disabled with mental disorders, such as depression, anxiety,

Pain, and PTSD, this itself costs the U.S. economy $43 billion in lost work days (Church, 2011).

Using conservative assumptions they estimate that the savings provided in treating these

psychological ailments with EFT-like treatments could save as much as $65 billion annually in

the U.S. economy (Church, 2011).

These studies are examples of where cost savings can potentially been seen with holistic

health medical treatments. The cost-containment focus in the realm of allopathic medicine may

encourage research to be completed in comparative analysis of treatments to determine efficacy

and cost savings. More comparative research from the use of energy medicine is one area that

20

might prove tremendous cost savings and provide more effective treatments for the healing

process. Bruce Lipton, in his book The Biology of Belief, states “the behavior of energy waves is

important for biomedicine because vibrational frequencies can alter the physical and chemical

properties of an atom as surely as physical signals like histamine and estrogen” (Lipton, 2005, p.

117). This is amazing that these vibrational frequencies are 100 times more efficient in relaying

bio-information than physical chemical signals produced by hormonal releases or pharmaceutical

drugs (Lipton, 2005). If such treatments are so much more effective and cheaper, they should be

considered as viable medical treatments. The American Medical Association should take note of

the Swiss Government’s recent action in announcing and publishing a report about the inclusion

of homeopathic and other CAM treatments to be covered in their national healthcare insurance

program as a result of their efficacy and cost effectiveness of these treatments (Gilbert, 2012).

Additionally, it is astonishing that the inclusion of such treatments in the government’s insurance

program, besides the clinical research they reviewed, was the result of a referendum where over

2/3 of voters requested the inclusion (Gilbert, 2012) - a sure sign the demand exists for holistic

health medicine.

Multi-disciplinary focus & influence of behavior finance mindset. Scientific research

is now turning towards multiple disciplines, blending insights from each together to establish

new perspectives that create understandings of the complex interconnections of our world

(Gilbert, 2008). The drive in part to a multi-disciplinary focus is the result of a change in

mindset or worldview that acknowledges the importance of looking at whole systems and their

inter-relationships to advance the knowledge in science. This change in mindset is setting the

stage for yet another evolutionary leap that is challenging old assumptions in various disciplines

of modern science, which is based on knowledge that is materialistic, reductionist, and objective

21

(Gilbert, 2008). A new mindset is being forged that recognizes subjective ways of knowing as

part of the equation from multiple fields that are blending their insights to address the rapidly

changing world and to ensure our ecological health (Gilbert, 2008). There are many examples of

disciplines merging together, where in the past they had worked at opposite spectrums and had

focused on research in isolation.

Some examples are the field of psychoneuroimmunology that has combined knowledge

from the disciplines of psychology, neurology and immunology to study the influence of

emotions, thoughts, and perceptions on the human biology and how this can influence wellbeing

(Pert, 1997). Energy psychology, seeking new ways of restoring balance, combines the insights

from psychology and energy medicine that studies the human body’s subtle energy system and

the power of our consciousness (Freedom, 2011). In studying the psychophysiological

coherence of our human body, the Institute of HeartMath looks at the electromagnetic energy

field’s interaction with the heart and the brain and the physical affect between individuals

(Gilbert, 2008). To further understand the human capacity many other disciplines are using the

study of neurology – such as neurotheology and neurofinance - that are rapidly changing the

mindset in multiple fields (Gilbert, 2008).

It has become evident that scientific disciplines can no-longer function in isolation nor be

ignorant to the ramifications of the application of their theories. From a macro viewpoint,

systems theory looks at a process or theory that is interconnected, considering the whole system,

and how a circular feedback loop influences the entire system, causing a set of inter-linked chain

reactions (Laszlo & Krippner, 1998). In making decisions, one needs to consider the

consequences down the line and the impact to interconnected systems across multiple fields in

the sciences – from scientific protocols, to business and economic models, to social and political

22

systems. The feedback mechanism acts as a sort of memory that is inherent in systems theory

and applies to all facets of society, even areas that have been previously assumed as self-

functioning - such as economics, finance - and can thus influence financial cycles (Courtois,

2012) and ultimately the manner in which scientific funding is focused.

Fundamental assumptions that have held together theories of economics and finance like

glue are now being challenged by research discoveries in the fields of behavioral economics and

behavioral finance that are recognizing the psychological biases of human activity (Courtois,

2012; Gilbert, 2008; Kahneman, 2011; Thaler & Sunstein, 2008). Individuals are not always

prone to rational behavior and acknowledgement of the intuitive system of thinking is slowly

changing the mindset in the fields of finance and economics, which is radically challenging the

fundamental principles in these fields (Fox, 2009; Kahneman, 2011; Thaler & Sunstein, 2008).

“For several decades the discipline had separated microeconomics, which was about selfish,

rational people interacting in perfect markets, from macroeconomics, which was built around

simple hydraulic models not based on any consistent theory of human behavior” (Fox, 2009, p.

178). It was the groundbreaking research of psychologists, Amos Tversky and Daniel

Kahneman, in their 1974 published research that identified behavioral biases that humans are

prone too, in contrast to making decisions based upon expected payoffs for given levels of risk,

that was later applied to the fields of economics and finance (Kahneman, 2011; Thaler &

Sunstein, 2008). Once considered a heretic himself, Richard Thaler, a professor of Behavioral

Science and Economics at the University of Chicago, is considered a pioneer in the field for

blending human psychology with economics and finance together and has spent the last 30 years

uncovering easily identifiable human biases that help explain anomalies of irrational behavioral

(Kahneman, 2011).

23

In Amos and Kahneman’s original research they identified three heuristics, or mental

short cuts, that influence human thinking and judgment – anchoring, availability, and

representativeness – of which become hardwired and are essentially unavoidable regardless of

expertise or awareness (Kahneman, 2011). Anchoring is framing decisions from a certain

perspective and making adjustments based on the original anchored position, whereby other

individual’s perspectives may be framed entirely differently (Kahneman, 2011). “You start with

some anchor, the number you know, and adjust in the direction you think is appropriate” (Thaler

& Sunstein, 2008, p. 23). Availability bias is the heuristic that influences the perception of the

likelihood of an event as relevant because of its recent occurrence (Kahneman, 2011) - such as a

tornado, flooding or robbery. Representativeness bias is the mental shortcut that influences

stereotypes (Thaler & Sunstein, 2008) – for example, assuming that all individuals with hoodies

are suspect.

These three heuristics influence individual behaviors on a daily basis and are widespread.

According to Nassim Taleb (2010) in his book The Black Swan, in making judgments individuals

tend to over-estimate how much they know about a situation and underestimate the occurrence of

events that are considered as outliers and are thus ignored. Quite often these are what Taleb calls

the pitfalls of causality – attempting to come up with rational explanations for the sake of

defining causation (Taleb, 2010). Both Thaler (2008) and Kahneman (2011) give numerous

examples that demonstrate how humans are hardwired for optimism and over-confidence in

contrast to situations where rational decision-making is assumed prevalent.

Kahneman, a 2002 Nobel Prize in Economic Sciences, in his book Thinking, Fast and

Slow (2011), distinguishes between two cognitive thought processes, automatic system 1 and

24

reflective system 2, and the interaction between them can result in conflict and hence a

behavioral bias (See Figure 2 below).

Figure 2 – Two Modes of Thinking

System 1 - automatic System 2 – reflective

Intuitive Rational

Uncontrolled Voluntary Control

Effortless Effortful

Unconscious Subjective

Associative Deductive

Innate or learned skill Rule-following

Fast Slow

(Kahneman, 2011; Thaler & Sunstein, 2008)

Kahneman points out that these are the two systems that determine our thought processes and

behaviors, and even though system 1 allows for extraordinary capacity, this system can over

power and influence behavior to result in irrational decisions (Kahneman, 2011). One example

that Kahneman (2011, p.27) utilizes in his book to demonstrate the conflict that can occur

between system 1 and system 2 is the famous Muller-Lyer image below:

25

The horizontal lines in this image are exactly the same length and based upon system 2 thinking,

with measuring these lines would confirm this (Kahneman, 2011). However, intuitively, system

1 automatically forces individuals to assume that the top line is longer because of the visual

illusion of the arrows pointing outward and results in fooling system 2 (Kahneman, 2011).

According to Kahneman, these behavioral biases are both cognitive and visual, and become

hardwired regardless of our expertise and awareness (Kahneman, 2011).

There are numerous implications of blending multiple disciplines that create new

discoveries, such as the fields of behavior finance and economics that is forging through a new

mindset. Just acknowledging the intuitive system of thinking in the field of finance is a giant

leap in of itself. During May 2012, the CFA (Chartered Financial Analyst) Conference held its

conference with Daniel Kahneman as one of the keynote speakers presenting the topic of his

book about behavioral finance and economics. In addition, another highlighted speaker was

James Montier who demonstrated in his presentation about the flaws of finance – bad models,

bad finance, bad incentives, and bad policies. Richard Thaler’s work in the field of behavior

economics is influencing public policy to help guide individual’s decisions in the area of health,

wealth, and happiness (Karlan & Appel, 2011; Thaler, 2009). In the new field of

neuroeconomics, Paul Zak (2012) in his book The Moral Molecule: The Source of Love &

Prosperity demonstrates that the rational selfish behavior that is innately assumed for economic

models is in contrast to how humans are biologically hardwired for cooperation, generosity, and

trustworthiness. This is mindset changing in the fields of finance and economics, where these

fields are finally acknowledging different ways of knowing and in doing so are also rattling the

grounding principles of their theories. This is broadening the mindset of multi-faceted

26

disciplines that will inevitably influence how and what aspects of healthcare are funded, possibly

increasing funding sources for the Holistic Health Medicine infrastructure.

Mindful Investment - Microfinance and Impact Investment

Mindful investment has existed for centuries and in modern times has been generally

known as socially responsible investing (SRI). Impact investing and microfinance are currently

the fastest growing part of SRI. The first part of this is section explains a brief history of SRI

and how microfinance and impact investing are defined. The next section describes the networks

of mindful investors that are driving the growth for microfinance and impact investing as part of

SRI.

History of mindful investment. The first known mindful investors were the Quakers

Religious Society of Friends in 1758 whom intentionally prohibited members from investing in

the slave trade from either buying or selling of slaves, to make a statement against such actions

(US SIF, 2011; Yankoski, 2009). Later on, in 1970 the Episcopal Church used ownership in

South African firms to pressure for an end to apartheid (US SIF, 2011; Yankoski, 2009). It was

during this time that the term Socially Responsible Investing (SRI) was used. Then in 1973,

taking the lead from those protesting against apartheid, the Interfaith Center of Corporate

Responsibility was created as a coalition of faith-based investors for shareholder advocacy

(ICCR, 2012). Today the ICCR, considered a leader in the area of SRI, is consisted of a

coalition of 275 faith-based organizations that advocate for corporate social responsibility by

27

owning shares of these companies and thus influencing the board to make changes based on

social and environmental concerns through shareholder resolutions (ICCR, 2012).

In general, SRI is when investors take action by purchasing shares of corporations to

promote corporate practices that promote environmental stewardship, consumer protection,

human rights, and diversity (US SIF, 2010; Yankoski, 2009). SRI are investing for a certain

social good and at the same time capturing a financial return, however through socially

conscious or ethical investing that is sustainable (US SIF, 2010; Yankoski, 2009). Typically

focus areas for SRI are the Environment (clean air and pollution), Social justice (human rights

and community development), and Corporate governance (executive pay and board issues) – and

is referred to as SRI in the area of ESG (ICCR, 2012; US SIF, 2010; Yankoski, 2009). Besides

ESG, there are some SRI that avoid investing in sin stocks that are considered businesses that are

involved with alcohol, tobacco, gambling, weapons, and/or military (US SIF, 2010; Yankoski,

2009). For SRI, the belief is prevalent that business has a responsibility to all stakeholders in

the community – shareholders, employees, customers, suppliers, communities – not just a

responsibility to the board of directors to only maximize short-term profits (Porter & Kramer,

2011; Yankoski, 2009). Their view is that corporations’ purpose is to create shared value or long

term profits for the firm and the community, produce products or services that are good for

customers, and without creating harm to the environment in wasted resources or inadequate

treatment of workers (Porter & Kramer, 2011; Yankoski, 2009).

The SRI has experienced tremendous growth for investing in social values compared to

conventional investment assets, and not only from the ICCR who representing the faith-based

sector, but also from the huge demand from private and public investing sources (US SIF, 2010).

The increase in demand for SRI mutual funds and SRI with shareholder advocacy has created an

28

industry in of itself. As a result of the huge demand in SRI, the US SIF forum for Sustainable

and Responsible Investment, formally known as the Social Investment Forum, was created as a

membership organization of investment professionals and institutions seeking research tools that

track mutual funds according to such SRI criteria as ESG and promoting long-term corporate

financial returns that make a positive societal impact (US SIF, 2012). According to US SIF

growth for SRI based on ESG stocks, shareholder advocacy, and community investing has grown

from just over $500 million in 1995 to over $3 trillion in 2010 (US SIF, 2012). This is

tremendous growth in SRI and is reflected in the chart below created from data from the US SIF

2010 Report on Socially Responsible Investing Trends in the United States:

* Dollars invested in ESG stocks, shareholder advocacy, and community investing

Through mindful investing – SRI as ESG stocks, shareholder advocacy, and community

investing - US SIF has a vision for a sustainable and equity economy. Although community

investing is relatively newer form of SRI, it is estimated to have grown 60% from 2007 until

2010 currently with about $42 billion and is therefore the fastest part of SRI (US SIF, 2012).

Community Investing is through means of socially responsible businesses, impact investing and

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

1995 1997 1999 2001 2003 2005 2007 2009

SociallyResponsibleInvestinginU.S.(InBillions$$$*)

DollarsinBillions

29

microfinance – all of which influence the wellbeing of the community through mindful

investment – see chart below (US SIF, 2012; Yankoski, 2009).

SRI – Community Investing Concept (Fastest growing part of SRI)

Community investing through microfinance and impact investing has the possibility to create

significant positive change for communities by providing these communities to access to finance

and funding for specific social targets of the community (US SIF, 2012; Yankoski, 2009). The

next section explains the basic principles behind microfinance and impact investing.

SolveSocial

Problem

Business

Model

SocialResponsibleBusiness(SRB)Goal

• VerySmallLoans•Marketsoverlookedbytraditionallenders

Microfinance&ImpactInvesting

• Stayswithlendingorganization

•Maximizesocialbenefit

Profit/Surplus • Putting$$into

under-servedcommunities

• Sustainable&ViableCommunitydevelopment

CommunityBenefits

30

Microfinance defined. Microfinance has existed for over the last 30 years and consists

of small microloans that are given to those predominately in the bottom of the pyramid (BoP) or

those considered poor who do not have access to financial services (Counts, 2008; Wright,

2001). It is estimated that approximately 80% of all households in developing countries do not

access financial services or are worthy enough to do business at banks (Counts, 2008; Wright,

2001). Including the entire world’s population, about 40% are excluded from financial services

or as much as 2.5 billion households (Bruck, 2006). Thus, it is not just the BoP that are lacking

in access to financial services but a large chunk of the world’s population.

The idea of providing small microloans to the poor was created by Muhammad Yunus, an

economics professor in India who was disturbed by the hunger and poverty situation in

Bangledesh and realizing that no economic model could fix the large number of people dying

(Counts, 2008). Yunus made his first microloan of $27 to 42 people who subsequently repaid

him and considered him an angel (Counts, 2008). Yunus then went to the banks to encourage

them to start making loans to the poor, however the banks had a certain mindset that the poor

were not creditworthy based on theories they had constructed long ago (Counts, 2008). Yunus

decided to challenge this mindset and created the first microfinance institution (MFI) in 1976 by

forming Grameen Bank, which has since distributed over $9.7 billion microloans to about 8

million borrowers without any collateral (Counts, 2008). The ironary is that banks only seem to

loan money to those who have money and not to those that need the money - Yunus challenged

this mindset and without the need for bank lawyers or loan guarantees (Counts, 2008).

Yunus, the 2006 Nobel Peace Prize winner, believed that access to credit was a human

right and found that especially women were predominately excluded from financial services

(Counts, 2008). Over 90% of borrowers at the Grameen Bank are women who have

31

demonstrated they are more responsible in repaying loans and typically handle the financial

situations in their households (Counts, 2008). Grameen claims that most of the loans they have

made have been repaid and after 5 years of being in their program, at least half of the participants

have risen out of poverty (Counts, 2008). Because of its success, most MFI follow the Grameen

Bank model (Bruck, 2006; Wright, 2001). Grameen bank borrowers are required to join

solidarity groups of at least 4 participants who support and encourage loan repayments,

participate in trainings, and receive rewards and incentives as a group (Alam & Getubig, 2010).

Women are typically targeted for loans as they have proven to have better loan repayments and

are the key to financial success in the household (Alam & Getubig, 2010). Mini-biographies are

completed of each borrower and loan officers are active in following up with their clients (Alam

& Getubig, 2010). Deposits are mobilized and after 12 months each branch is expected to

breakeven (Alam & Getubig, 2010). Currently the Grameen bank is self funded with savings

deposits and no longer receives outside funding or grants (Counts, 2008).

The MFI sector has grown phenomenally since the 1970s and previous doubters of the

old banker’s mindset are now are now paying attention (Counts, 2008). According to the Skoll

World Forum (2011), an international platform to advance social issues through

entrepreneurship, at the end of 2009 there were over 35 MFIs operating in 115 countries with

$65 billion in microloans. The 1997 Microcredit Summit set a goal of reaching 100 million of

those at the BoP by the year 2005 and achieved this with only a one year delay despite much

skepticism and is forging towards the 2015 goal of reaching 175 million households (Counts,

2008). Since the inception of the MFI concept, the literature now demonstrates that those at the

BoP are creditworthy and are in need of financial services (CGAP, 2009). Housed at the World

Bank, the CGAP is an organization focused on advancing financial access for the BoP, argues

32

that financial services that meet widespread population has a positive affect on public policy, as

well as the health and welfare of the community (CGAP, 2009). Thus MFI can be found in all

corners of the world - from Grameen and Brac in India; Accion in Latin America as the first

commercial MFI focusing on profit; and Pro Mujer in Boliva not only providing MFI but also

health initiatives, such as family planning and mental health (Bruck, 2006).

Impact investing defined. As part of the fast growing area of SRI, impact investing is

channeling larger amounts of funding for social benefit through private equity and nonprofit

projects (Cordes, 2010; O’Donohoe, Leijonhufvud & Saltuk, 2010; Stern, 2011). There has been

a sort of change in mindset to blending both philanthropy for a social impact and profit together

(Stern, 2011) or can be viewed as combining social justice with capitalism (Cordes, 2010).

“With increasing numbers of investors rejecting the notion that they face a binary choice

between investing for maximum risk-adjusted returns or donating for social purpose, the impact

investment market is now at a significant turning point as it enters the mainstream” (O’Donohoe

et al., 2010, p. 5). To differentiate with the typical manner of SRI, which invests in companies

that are socially responsible, impact investing seeks to invest in a concept that is based on a

social purpose (O’Donohoe, 35 al., 2010). According to the Global Impact Investing Network

(GIIN), which was launched as a subsidiary of Calvert Foundation a renown SRI, for the past 20

years the impact investing movement has emerged to address social and environmental issues

through utilizing sustainable business models (GIIN, 2012).

In creating social change with a lasting impact it is generally viewed that such measures

as impact investing can be more effective than government funding which is quite often laden

with corruption in especially developing countries (Cordes, 2010). In working with high net

worth clients, finanacial planner Ron Cordes states:

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Although it’s barely on most investors’ radar screens today – and despite the fact that some microbanks have been in the news recently for doing more harm than good in these developing countries – I still firmly believe that in the coming decade impact investing could fundamentally reshape how your clients “do well by doing good,” how the planet’s biggest problems get solved and how you bring value to wealthy investors. (Cordes, 2010, p. 45)

For the year 2012 alone it is estimated that over $4 billion will be invested in impact investing (J.

P. Morgan, 2011) and already in 2010 over 48% of high net worth U.S. investors were interested

in the concept of impact investing (GIIN, 2012). J.P. Morgan who has been a leader in

researching the field argues that impact investing should be considered an asset class in of itself,

similar to debt or equity, as to the nature of its category function and this would result in

additional emphasis and investment in impact investing (O’Donohoe, et al., 2010). Some

financial planners are recommending their clients invest 2-4% (Cordes, 2010) and for institution

investors it is as high as 5-10% of their portfolios are recommended in impact investments (J. P.

Morgan, 2011). The potential market for impact investing in the next 10 years in focuses areas -

housing, water delivery, maternal health, education and financial services – are estimated to

invest $400 billion to $1 trillion (O’Donohoe, et al., 2010). The area of maternal health alone

could see an influx as much as $2 billion in impact investing for the same period (O’Donohoe, et

al., 2010).

Networks of mindful investors. Socially responsible investors are driving the growth

for financial inclusion through microfinance and social benefit through impact investing. The

mindset is changing from old embedded ways and is being influenced by widespread funding

sources from large institutions, to high net worth investors, and individuals worldwide that are

hoping to make a difference. Google’s founder, Pierre Omidyar, decided to create the Omidyar

Network with his fortune to focus on funding entrepreneurs through microfinance that promote

34

sustainability solutions (Bruck, 2006). In addition, both the Dell Foundation and Gates

Foundation have funded MFIs to ensure that financial services are provided to millions of those

at the BoP (Bruck, 2006). To promote social entrepreneurship, Ashoka is an online network

matching funding sources with innovators who are denoted as changemakers (Hicks, 2010).

Ashoka aims to bring scale to social innovation through the support of creative solutions to

societal problems and through a forum where impact investors can target the best ideas in certain

focus areas (Hicks, 2010). For individual investors who want to financially support a social

innovator anywhere in the world for as little as $10 can lend a borrower of their choice by

utilizing the online microlender’s network, Kiva.org, and make a social impact (Flannery, 2007).

Kiva has an astonishing 90% “re-loan” rate meaning that almost all lenders choose to borrow

again after they have been repaid (Flanner, 2007).

Muhammad Yunus believes that the poor are social innovators because their lives force

them to look for creative options (Yunus, 2007). Yunus sees that human beings have the natural

capacity to be innovators, however, he views our educational system as limiting the creative

mindset by reproducing students that perpetuate old embedded ideas that stifle innovation

(Yunus, 2007). As an economist, Yunus challenges the concept of business to maximize profit

because human beings are much bigger than this ideal and that economic theory needs to include

a small part of humanity (Yunus, 2007). He promotes the concept of social business with a

social purpose, producing social MBAs and that investors retain profits within the business – an

excellent idea for a social business is healthcare (Yunus, 2007). Through the Grameen

Foundation, Yunus is turning towards impact investing and microfinance to make social change.

Most of the MFI focus outside the U.S., however Yunus pointed out that New York City has the

biggest banks in the world but does not even lend to its own people, and therefore decided to

35

create its first MFI in New York City (Yunus, 2007). The need to reach the unbanked is no

longer a concept for developing countries, but in the U.S. initiatives are being created such as

Core Innovation fund, a venture capital fund, to provide low-cost financial services to

entrepreneurs that fall short of the banking gap (St. Anthony, 2012). Again Yunus and others are

challenging the mindset on who is credit worthy.

Dean Karlan is challenging the traditional mindset for addressing social issues in

developing countries by utilizing behavior economics and field research from his organization

Innovations for Poverty Action (IPA), for initiatives in microfinance, healthcare, and education

(Karlan & Appel, 2011). Karlan learned from behavioral economics that not everything that

matters is in dollars and cents - humans do not always arrive at the same decisions through cost-

benefit analysis (Karlan & Appel, 2011). “Traditional economics gives us economic humans,

the archetypes for rational decision-making” (Karlan & Appel, 2011, p. 6) but in contrast we are

shockingly inconsistent with regards to the decisions we make. Through IPA he demonstrates

that by combining economic incentives with psychological nudges can help create positive

change for those at the BoP (Karlan & Appel, 2011).

Mindful Investment in Holistic Health Medicine

Mindful investing is trying to influence a change in mindset through funding sources,

such as impact investing or microfinance, to create a social impact in various areas, including

healthcare. Along with conventional manners of SRI, there now exists social online platforms

that have been created, which is increasing ways in which individuals, high net worth investors,

and organizations can mindfully invest depending on their social concerns. This is being done

worldwide and not just in developing countries, where MFI have predominately functioned to

provide financial services for the BoP, but within the U.S. as well. In general, approaches to

36

mindful investing to address concerns in healthcare are based upon conventional allopathic

medical philosophy. However, as multi-disciplined fields merge together forging a change in

mindset and as increased avenues for mindful investment arise the opportunity for mindful

investment for holistic health medicine will increase.

This section will first touch on areas where mindful investment is being utilized for

health related areas that are based on conventional allopathic medicine. The next section touches

on windows of opportunities for mindful investment for holistic health and some examples that

my research uncovered.

Mindful investment for health. Dean Karlan’s use of behavioral economics is based on

the idea that humans have different mindsets and do not always respond in assumed rational

ways to decisions taken relating to health issues in developing countries (Karlan & Appel, 2011).

In Karlan and Appel’s book (2011), More than Good Intentions: How a new economics is

helping to solve Global Poverty, they demonstrate that because of irrational behavior one cannot

assume that some solution is good if the people do not buy it. In creating solutions from a

different mindset, Karlan’s Innovations for Poverity Action (IPA) uses psychological nudges to

address health issues where traditional measures are not feasible (Karlan & Appel, 2011). One

example of this is the issue of diarrhea and lack of pharmaceutical treatments, or adhering to

such treatments, in developing countries, where over 2 million children die yearly, IPA used

rehydration therapy that consisted of small plastic envelopes of salt, a cheap viable resource, to

help the body absorb and retain water (Karlan & Appel, 2011). In addition, IPA is attempting to

bring to scale another health initiative through psychological nudges to deworm children at their

local schools rather than having them visit a health clinic - thereby school-based deworming is

creating a different mindset of where healthcare can be delivered (Karlan & Appel, 2011).

37

Now that the microfinance field has matured, MFI are looking to expand and provide

financing in other areas such as healthcare coverage (Basargekar, 2010; Lashley, 2008; Ofori-

Adjei, 2007). In Argentina, Banco Mundial de la Mujer (BMM) realized that the lack of health

coverage for their microfinance clients put them at a great risk of defaulting on their loans

because of their medical bills (Lashley, 2008). Access to both finance and to healthcare was a

human right and necessary to improve the lives of those at the BoP. In BMM paying a nominal

premium for basic healthcare services for their clients their clients then paid a third less to visit a

doctor, which alleviated the financial burden of medical bills that often caused clients to default

(Lashley, 2008). According to the World Health Organization (WHO), illness and the stuggle to

pay medical bills puts about 100 million people into poverty each year (Ofori-Adjei, 2007). The

challenge for most developing countries, such as Ghana and India, is providing for affordable

healthcare considering government does not have sufficient revenue basis and most the

population cannot afford to pay for medical services, microfinance combined with healthcare

services is an alternative solution to help avoid financial burdens (Afori-Adjei, 2007; Basargekar,

2010). Upon blending microfinance with healthcare insurance there are many advantages, such

as: spreading the risk of a pool of insured that provides medical services cost effectively,

increasing the use of necessary health services, and creates standardization and uniformity of

healthcare services (Basargekar, 2010).

The Grameen Foundation is utilizing impact investing to provide medical services that is

accessible through mobile phones to expectant mothers in Ghana called Mobile Midwife

Program (Grameen, 2012). They have also created a health initiative where Knowledge Workers

(CKW), who already provide regular weather forecasts, are trained to use a smartphone to

retrieve information about disease and where they can access drug treatments (Grameen, 2012).

38

The availability of mobile phones and the technology of smartphones has created increased

accessibility to information, however, in the case of Grameen Foundation they are utilizing these

technologies to promote conventional allopathic treatments.

The micro-lender Kiva.org allows for mindful investors to screen by categories, such as

health, however generally those borrowers in this area are based on conventional healthcare

needs such as pharmaceutical or organic beauty products (Kiva, 2012). How Kiva operates is

they enlist MFI around the world that they denote as Field Partners and list the microloans, who

are the Kiva profile loan requests, from these Field Partners organized by categories for ease of

investor selection (Kiva, 2012). Therefore, there does arise the opportunity under healthcare to

include holistic health borrowers, however, they have to already be a borrower from an

established MFI that Kiva considers as one of their Field Partners.

The Global Impact Investing Network (GIIN) maintains a database of impact investors

also allows mindful investors to search by categories and in the health focus produced only one

fund manager who invests private equity exclusively in companies providing sustainable and

healthy living products for consumers (GIIN, 2012). This would be a stretch to say their focus is

related to holistic health medicine; however, the mindset is changing as evidence to the buz-

words utilized such as “sustainable” and “healthy living”. Interestingly so is the manager for

their focus has a background as a practitioner (GIIN, 2012), leader and investor in the health and

wellness community for over 30 years, which implies some form of linkage to holistic health and

wellness.

Other examples of impact investing utilized to influence healthcare exists in California

where MetLife and NCB Capital Impact together gave a social investment loan of $5 million to

establish community health centers as 1 in 5 residents are uninsured in the state (Rauber, 2010).

39

Focusing on making a difference in providing healthcare, NCB Capital Impact has invested $500

million nationwide for community health centers (Rauber, 2010). Although this report does not

acknowledge information about the type of healthcare provided at these community health

centers, what is significant is the desire to utilize mindful investment in healthcare that

eventually can be focused on holistic health.

Holistic health related mindful investments. There are very few examples that my

research uncovered where mindful investment is being utilized for holistic health related

medicine, as in most cases allopathic medicine is the dominate philosophy. Impact investing and

microfinance for holistic health medicine is still in its infancy. However, I will point the few

examples I encountered. The Grameen Foundation has funded its first MFI in New York City

called Project Enterprise as 74% of poor in the United States live in major urban areas (Grameen,

2012). In their first year of operations they gave out 500 loans (Yunis, 2007). According to

Project Enterprise their current loan portfolio consists of 8 individual loans in the Health and

Wellness category, with only 2 of these loans that fit mindful investment in the area of holistic

health medicine, which are: Holistic Health & Wellness Spa and Health/Nutrition Organic

Products (Grameen, 2012). This was encouraging to at least see a few mindful investment in

holistic health related areas.

The Ashoka Innovators for the Public had much more promising examples of mindful

investment for holistic health medicine. One of the Ashoka fellows shown on their database is a

Canadian social pediatrician who has designed a model of treatment that addresses sickness and

disease in a radically different manner through community-driven preventative care that

addresses how medical conditions are influenced by social conditions (Ashoka, 2012). His

model is holistic in that he is engaging all social systems that influence the health of children,

40

such as the school system, parents, communities, along with pediatric health care as integrated

together (Ashoka, 2012). Ashoka has supported over 2000 fellows who receive a small stipend

as a source of mindful investment, however, becoming a fellow brings much visibility to their

innovative ideas for social change than funding from Ashoka.

In addition, Ashoka lists Changemakers who are social entrepreneurship individuals with

creative innovations (Ashoka, 2012). Potential mindful investors can screen Ashoka’s database

for a particular category, which will display all the changemakers in this category, or the

changemakers can choose to participate in an impact investor’s open source competition and be

selected as a winner (Ashoka, 2012). One example of an open source competition was for

Innovations for Health Solutions that Cross Borders and one of the winners was Saude Crianca

(Holistic Health Solutions for Low Income Families) who was a changemaker organization in

Rio de Janeiro (Ashoka). Screening for changemakers under the health category for the U.S.

produced at least two holistic health related organizations: Holistic Therapies offering Reiki,

reflexology, aromatherapy, and massage located in England; the other was Sharp Coronado

Hospital Complementary & Integrative Healthcare Initiative located in San Diego (Ashoka,

2012). These are significant examples of holistic health medicine seeking mindful investment.

Furthermore, Ashoka is beta testing another aspect of their network where social innovators can

create or participate in changeshops where changemakers present entrepreneurship ideas that

make a difference or provide support to such ideas through mindful investment or other non-

monetary support (Ashoka, 2012). This may be an opportunity to create mindful investment and

support for holistic health medicine.

Besides the research that I uncovered for mindful investment, I also attempted to search

out local avenues of mindful investment in holistic health medicine. The Minnesota Angel

41

Network (MNAN), recently created as a result of tax incentives, is a professional non-profit

organization that promotes entrepreneurship by providing educational resources and hosting

potential angel investor forums (Grayson, 2011). I attended a meeting sponsored by the

Minnesota CFA Institute and learned that this form of impact investing is generally based on

conventional medical device or pharmaceutical investments. In addition, I learned that Women

Venture organization generally provides educational resources with very little small business

loans, however 2 of those listed as their clients consisted of holistic healthcare services: yoga and

wellness center; oriental medicine clinic providing acupuncture, Chinese herbal medicines, and

massage (Women Venture, 2012).

To understand the banker’s mindset, I met with a local commercial lender. Our

conversation was interesting and I learned that in general the banker’s mindset is to stay away

from alternative medical practices such as chiropractic. Holistic health practices do not have

established histories of borrowing money from bankers and therefore they tend to avoid such

borrowers. In comparison, outside the normal net worth and debt-to-equity ratio that banks

utilize to determine loan-worthiness, they look at what is considered “bankable assets”. These

“bankable assets” are the regular client base that is considered consistent billable revenue for

such practitioners as dentists or orthopedic doctors. They have a customer base and typically this

base is a regular revenue source, thus the bankers consider this future revenue as “bankable

assets” and help the capacity for these practitioners to be able to access credit. What was

interesting in how this commercial banker had a certain mindset of chiropractic offices – those

shady locations on the corner of some strip-mall. Later I reflected upon this and how dentists’

offices typically fit this same description, however, they have the “bankable assets” to be

42

considered credit-worthy that the chiropractic do not appear to have – at least that is from the

banker’s mindset.

Implications for Holistic Health Medicine

A changing mindset is creating new avenues for financing and funding that can be

applied to holistic health medicine to grow the infrastructure. The drive for innovation and

social entrepreneurship has created a network of mindful investors who are seeking to make a

difference through microfinance and impact investing. Consumer demand already exists for

holistic health medicine, yet a gap in funding for research may also be closed through the cycle

of behavior that influences economics, thus influences funding for research. In revisiting Figure

1 below, this multi-directional, multi-dimensional cycle that can be influenced at various

junctures can impact the mindset for growing the infrastructure for holistic health medicine.

Figure 1

Financing and funding is moving into new territory as a result of changes in mindset. Research

is now more than ever before dependent upon multi-disciplined focuses. The field of finance and

economics, that greatly influence mindset for funding, is finally recognizing subjective ways of

knowing and as a result of this is also rattling old-founded archetypal principles of financing.

HolisticHealthMedicine

funding

researchapplication&practice

consumerdemand

43

Research in multi-faceted fields is demonstrating that we are hardwired for two systems of

knowing, where our innate capacity is built on cooperation, generosity, and trustworthiness in

contrast to the conventional economic belief that consumers make decisions based on only self-

serving rational human behavior. The allopathic medical model has reached a plateau and no

longer is providing for much advancement in healing or disease, which has become an

unsustainable model. In fact, the mindset is changing in how we approach disease and healing,

acknowledging the limits of pharmaceutical drugs, and that conventional medicine may not be

the cure-all. Cost containment measures in the healthcare field are forcing all participants to

consider the efficacy of modern medicine compared to alternatives; also they are challenging the

capitalistic influence of medicine, such as the drive for pharmaceutical growth; and seeking out

preventative health measures that address the whole body, mind, and spirit that influences our

well-being.

We are in the midst of challenging the conundrum of mindset and funding to grow the

infrastructure for holistic health medicine. At each juncture of the cycle demonstrated in Figure

1, from multiple directions and dimensions, all participants of this cycle are changing mindset

through conscientização that will create a tipping point and further the shift towards holistic

health medicine.

44

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