HighTower, a high-flying independent RIA based in Chicago, has caught green fever.
The firm, which serves high-net-worth clients, corporations and institutions, is helping implement energy efficient offices, encouraging recycling, and limiting paper and printer use throughout its offices nationwide.
“We are also reducing our carbon footprint by supporting the use of public transportation for our employees through pre-tax vouchers and coupons,” says Matt Camden, HighTower’s chief technology officer.
HighTower has been able to take these environmentally conscious steps partly because of its unusual business model: It is an open-source, advisor-owned financial services firm. As such, it is duly registered as a broker-dealer and RIA, in addition to being a multi-clearing and multi-custodial firm. This model allows it to be free of conflicts sometimes associated with traditional brokerages.
Advisors and managers are partners, with 50% of the firm owned by employees and advisors, and the other half by investors.
Elliot Weissbluth, HighTower’s CEO, and Drew Kornreich, president, formed the firm in 2008 and have recruited advisor teams from wirehouses and top independent advisory firms. Early investors have included some high-powered luminaries: David Pottruck, former CEO of Charles Schwab Corp. and now CEO of Red Eagle Ventures Inc., a private equity firm in San Francisco; Douglas Brown, former vice chairman of investment banking at Morgan Stanley and founder of private equity firm DLB Capital; and Philip Purcell, the former CEO of Morgan Stanley who now heads private equity firm Continental Investors.
“When we kicked off operations in 2008, we immediately formed a green committee as part of our corporate social responsibility initiative,” explains Camden.
HighTower focuses its attention on reducing its paper and power consumption and decreasing its local and national carbon footprint.
“We got green from the ground up,” says Camden. “For example, we instituted a document management system to create a paperless environment from the beginning when we had eight employees rather than try to make the change when we grew to 125 people.”
As an example of its paper reduction efforts, the firm’s client files are stored in an online document management system.
“Our clients receive statements electronically. We use efax software rather than traditional fax machines, and of course offer recycling and shredding bins in every office,” says Camden. “It protects client data, as well as having the benefit of recycling.”
In terms of power reduction, HighTower embraces the new technology, cloud computing, which enables mobility and scalability for firm growth but is also green.
“It’s green,” says Camden, “because none of our offices require an internal data center or phone closet. Instead, we simply have one communications device, using one outlet that connects each of our offices to our private voice and data network. Our voice and data network are hosted by tier 1 providers, such as AT & T and Thomson Reuters, who run green data centers and sell excess power capacity to their local communities.”
On the local level, pre-tax public transportation vouchers encourage the use of public transportation by its employees. On the national side, HighTower keeps air transportation costs to a minimum by embracing audio, web and video conferencing. “Even our instant messaging software has a video component to it,” notes Camden. HighTower is also taking a number of smaller steps, including using filtered water and glasses rather than plastic bottles. “We’ve also built our technology infrastructure to make it very easy and inexpensive to work from home,” says Camden.
“Finally, our corporate offices support local business green initiatives, such as here in Chicago we are members of the Chicago Sustainable Business Alliance.”
To top things off, HighTower attaches a “Think before you print” tagline on every email it sends.
These strategic initiatives and small steps have helped HighTower form its corporate social responsibility identity. As it turns out, it has been important to both its advisor teams and clients.
“It may not be a primary factor in their decision making, but we view it as one of the tiebreakers that help advisor teams and clients choose HighTower,” say Camden.