Mission Aligned Investing
Mission Aligned Investment Policy
The Valentine Foundation is committed to aligning up to 10% of its assets in order to increase impact beyond grantmaking activity. We the trustees of the Valentine Foundation formally adopt the following Investment Policy Statement to reflect our values—
In order to increase the impact of The Valentine Foundation’s assets and further the mission, up to 10% of our assets will be invested in mission related, and/or socially responsible vehicles. The Foundation’s Investment Policy and asset allocation will be updated to reflect:
- Mission, Goals and Objectives
- Risk and Return Expectations
The most important objective for this Mission Aligned portion of our assets is to promote greater social impact beyond our grantmaking activity. We believe that by using some of our invested assets in mission related investments we will further our mission and have greater social impact.
Putting Our Money Where Our Mission Is
Mission-aligned investing has been getting some buzz around the philanthropic community for the last few years. So when the Valentine Foundation’s board members heard about it at the PHILAnthropy Annual Conference in 2015, it did not stand out anymore than before. But when a sister family foundation explained how easy it was to expand the reach of their mission, Valentine was in.
The Valentine Foundation began in 1985 by Phoebe Valentine to fund programming that advances social change of women and girls. The Foundation consists of a part-time executive director and a six-member voluntary board who oversee the granting of approximately $180,000 dollars annually. While none of the board members is a trained financial advisor, they work collaboratively with a long standing financial management company (led by a former trustee) to review the endowment’s portfolio at each meeting including the performance of equities, mutual funds, and cash. In the fall of 2016, they realized they could do more.
It started with placing the 5% cash that was sitting in a large bank, whose name is prominent on Wall Street, into a local community held bank. By allocating this cash balance on the local level, Valentine was honoring the ability for local banks to lend locally. And this action was an extremely low risk as the credit union is FICA insured institution.
Next, the trustees considerd how they could use other cash in low risk ways. After all, they did not want to risk the highs and lows of the S&P nor did they want to sit on a CD for 10 years. At this moment, they learned that the Inter-faith Housing Alliance (a 501©3 nonprofit organization dedicated to working with individuals experiencing homelessness) was in need of a loan to rehab a property that would serve families in transition.
Inter-Faith Housing Alliance
Valentine Foundation considered the risk – by lending Inter-Faith $30,000 over five years at an extremely low interest rate, they would experience the same financial gains of a CD. And while the risk might seem higher, they evaluated Inter-Faith’s financial statements, references, and project scope and decided the risk was low. There was already other committed funding on the line with Inter-Faith’s project and Valentine could create a lift with the renovation project. It was a win-win.
The advisement of that sister family foundation cannot go unnamed. It was the contact and support of Laura Kind McKenna, formerly the executive director of the Kind Foundation, that helped the Trustees keep these activities simple while protecting their endowment. Valentine is extending this type of support to other small foundations as it was this pivotal peer advice that led to their action.