Putting their money where their mission is
By Alan Cantor
In my last post, I wrote about foundations that do mission-related investing – that is, they not only make grants, but also invest some of their endowments in places like the New Hampshire Community Loan Fund and in what our friend David Hills calls “high-impact” investments.
If you want to see a place whose leaders have thrown themselves into this concept with all their hearts, check out the F.B. Heron Foundation.
The folks at Heron realized early on that their impact would be limited if they only made grants. So they started investing parts of their endowment in ways that directly supported their grantees’ work. Over the years, they created the foundation world’s cutting-edge mission-related investing program.
A startling fact: Fully 46% of Heron’s endowment is invested in ways that support its mission. Its managers have worked around the country doing what they’ve done with us at the Community Loan Fund: They’ve given us grant dollars so we can carry out our work, and invested with us, so we have additional money to lend throughout New Hampshire and increase our impact.
It’s worth noting that Heron has not sacrificed return in order to do this. In fact, for the 15 years ending Dec. 31, 2009, Heron was in the second quartile of the Cambridge Associates Peer Benchmark. That is, Heron has achieved better-than-average returns – even with such a significant exposure to mission-related investments.
By the way, there’s a new organization that’s encouraging more foundations to do what Heron has done: More for Mission.
Yes, F.B. Heron is a fairly large New York-based foundation, and, yes, it has advantages over smaller, sparsely staffed foundations. But the principles that work for Heron would work at small foundations as well. If you fit in that category, check them out!
Alan Cantor is the former Vice President, Philanthropy for the Community Loan Fund. He is now principal of Alan Cantor Consulting LLC.