{"id":29588,"date":"2020-08-26T18:41:28","date_gmt":"2020-08-26T22:41:28","guid":{"rendered":"https:\/\/test.greenmoney.com\/2025\/?p=29588"},"modified":"2020-10-02T16:42:52","modified_gmt":"2020-10-02T20:42:52","slug":"sustainable-investments-that-foundations-can-make-for-people-and-the-planet","status":"publish","type":"post","link":"https:\/\/test.greenmoney.com\/2025\/sustainable-investments-that-foundations-can-make-for-people-and-the-planet\/","title":{"rendered":"Sustainable Investments that Foundations can make for People and the Planet"},"content":{"rendered":"
>> Back to September 2020 Issue<\/a><\/div>\n

\"ChristenThe climate emergency is driving innovation that philanthropy can fund, and is funding, with foundation investment capital. With the lived-experience of forest fires, major hurricanes, coastal flooding and other recent, tangible consequences of a rapidly warming planet, the urgency to deploy more capital to find solutions is activating more immediate action. The disproportionate impact that environmental injustice has on communities of color and low-income communities in the United States and around the world expands the universe of foundations seeking to change how they deploy capital.<\/p>\n

Many foundations are responding by reaching beyond grantmaking and reconsidering their investments in traditional asset classes, creating new models and collaborating, all while keeping the future of planet Earth and the people who populate it as their central missions.<\/p>\n

Foundations also have a unique ability to provide capital to ramp up new technologies, catapult \u201cmoonshot\u201d ideas to fruition, influence corporate behavior and activate other funders to participate in projects that might have otherwise been considered too risky for business or government, accountable to a different set of external stakeholders.<\/p>\n

With some 100,000 private foundations in the U.S., just a small percentage are the size of the Bill and Melinda Gates Foundation. No matter the size of the foundation, all of them can combine grantmaking and sustainable investing now for immediate benefits to climate.<\/p>\n

Reconsidering ESG<\/h2>\n

GreenMoney Journal<\/em> has covered the merits of sustainable and Environmental, Social and Governance (ESG) portfolios for several decades. Foundations that align their endowments to climate missions are demonstrating the financial benefits. Rockefeller Brothers Fund (RBF) just underscored that point, when in May 2020 it detailed how its investment returns beat market benchmarks since divesting from fossil fuels five years ago. The case study Investing in Our Mission<\/a><\/strong> shows the RBF posted an average annual net return of 7.76 percent over the five-year period that ended December 31, 2019. Over the same period, an index portfolio made up of 70 percent stocks and 30 percent bonds\u2014including coal, oil, and gas holdings\u2014returned 6.71 percent annually. With more than $1.22 Billion in assets, RBF\u2019s experience provides a proof that gives other foundations the encouragement to model.<\/p>\n

Look Close to Home<\/h2>\n

Foundations are not limited to aligning their endowments to an ESG lens. The old adage, think global and act local has taken on a new moniker: place-based impact investing<\/em>. Installing renewable energy generators like solar and wind projects are already proven to ease carbon consumption while providing a financial return to its investors in specific locations, both urban and rural parts of the country. Foundations can help amplify those outcomes by investing in building an ecosystem of stakeholders, knowledge-holders and investors.<\/p>\n