Investing approaches used by wealth managers, investment advisors, and foundation investment staff such as environmental, social, and corporate governance (ESG); socially responsible investing (SRI); and impact investing fall short in substantively supporting social justice, a study from Just Futures argues.

According to the report, Building a Social Justice Investment Chain (52 pages, PDF), the tactics used in those approaches have been used by Wall Street and members of the “extractive investment chain” to enrich themselves and the established investor class. Instead, foundations and philanthropists should move toward a movement-led approach to create true social justice investment chains, the report’s authors argue.

The report highlights how to build an investment chain that helps further social justice by aligning with social justice movements, investing in power-building approaches for marginalized communities, emphasizing community ownership, and helping make the investment world more accessible.

“The time has come for philanthropy—donors, foundations, and their advisors—to actively take control of ESG and impact investing, before it simply becomes another way for Wall Street to impact-wash their extractive investment methods that impoverish communities of color and deepen income inequality,” said Anand Jahi, author of the report, and Just Futures co-founder Steven Choi in a joint statement. “At a time when more Americans want to put their money where their values are, we need American philanthropy to take a new, transformative approach that truly empowers our communities to deal with racial equity, climate justice and threats to our democracy. Just Futures is excited to help take the social justice movement to the financial industry and move down the path to a truly regenerative economy.”

(Photo credit: Getty Images/Vesnaandjic)