CONTENTS |  | Letter from the Chair | | Principles | | Endorsers | | Practices | | Actions | | The Building | | Transportation | | Meetings & Conferences | | Money Matters | | | | | Investments Foundations traditionally seek to grow their investment portfolio in order to maximize the amount they are able to spend on grantmaking. In recent years, however, newly developed funds and assessment tools are making it possible to maximize investment performance in a way that is consonant with an organization's mission. To paraphrase Gandhi, it is becoming increasingly possible to reduce the dissonance between our creed and deed. All investing has social and environmental consequences. Mission-related investing, one of many terms used by foundations to describe efforts to align their asset management and grantmaking, takes account of these social and environmental consequences in making financial decisions. It adds depth to the investment process by assessing environmental liabilities that might lower shareholder value, and by assessing environmental opportunities that are often reflected in higher shareholder value. A growing body of financial data confirms that, at a minimum, screening a foundation's portfolio has neither a positive nor negative effect on performance. Most studies, however, show superior performance of screened funds because good environmental management is seen as a positive indicator of good corporate governance. Morningstar, the mutual fund rating company, compared screened and non-screened mutual funds. They found that screened funds were twice as likely to have the highest five star rating, and four times less likely to have the lowest rating of one star. Two screened funds that mimic the S&P 500, the Domini Social Index and the Citizens Index, have outperformed their benchmark, by 3 and 7 percent annualized. Mainstream investment houses, Vanguard and Dow Jones, all offer screened products. If fiduciary responsibility is defined only as maximizing return, mission-related investing should be considered. In addition, mission-related investing can add value to grants. Increasingly companies are approaching social analysts asking how they can improve their performance to become part of screened universes of companies, demonstrating that screening is having an impact. Voting proxies can make the foundation's voice heard in corporate board rooms, whether or not the foundation screens its portfolio. The Foundation Partnership on Corporate Responsibility will assist foundations wanting to learn more about the issues, and in developing proxy voting guidelines. Lastly, foundations can invest their assets in ways that support their grantmaking programs. This may be through program-related investments, through investments in community activities, and through mission-related venture capital that encourage the development of young corporations whose products, processes and cultures reflect the foundation's grantmaking values and priorities. It is also important to note that, in many cases, PRI's can count against a foundation's payout requirements. Mission-related investing need not be an all or nothing proposition. Many foundations experiment with different approaches to find their own comfort level. Some begin by voting their proxies in line with their program goals. Others designate a proportion of their portfolio to screening - 10 percent or so - in order to better understand the process and the possible returns. What is most important is for the foundation's board to begin the dialogue first among them- selves and then with their financial managers, consultants, and others involved in the investment process. Assistance in working through a program of "asset harmonizationÓ can be obtained from investment managers committed to various forms of what has been called "social investing,Ó as well as other foundations that have gone through the process, such as the Jessie Smith Noyes Foundation. top Finance Switch your company credit card to an affinity card which makes it possible for environmental groups to get a portion of each purchase and processing fee. It may only be a few cents per charge, but it adds up. You may also want to check with particular environmental organizations to see if they have an affinity card program. Whichever card you choose, remember to verify how much money actually is paid to groups; cards vary widely. There is a similar program for check writers. Every time you order a certain brand of checks, money is donated to a participating environmental group, and the checks have the organization's logo on them. You can use these checks no matter where you bank. Please note, however, that these checks aren't available in formats suitable for larger businesses yet. To order, contact Message! Products [see address below]. Share the above information on affinity cards and checks with all foundation employees, and encourage them to share the information with their friends and families. In 1999, Working Assets gave a total of $4,000,000 of donations from their long distance, credit card, internet access and online services to non-profit groups. Approximately $780,000 of that amount was divided among 10 environmental organizations. top Organizations Foundation Partnership on Corporate Responsibility
c/o Interfaith Center for Corporate Responsibility
457 Riverside Drive, Room 550
New York, NY 10115
212.870.2293
www.foundationpartnership.org (opening winter 2000) Coalition for Environmentally Responsible Economies (CERES)
11 Arlington Street, 6th floor
Boston, MA 02116
617.247.0700
www.ceres.org
Request a copy of CERES Principles and a list of endorsing corporations Council on Economic Priorities
30 Irving Place, 9th floor
New York, NY 10003
800.729.4237
212.420.1133
www.cepnyc.org Interfaith Center for Corporate Responsibility
475 Riverside Drive, Room 550
New York, NY 10115
212.870.2293 Investor Responsibility Research Center
1350 Connecticut Avenue, NW, Suite 700
Washington, DC 20036
202.833.0700
www.irrc.org Jessie Smith Noyes Foundation
6 East 39th Street, 12 Floor
New York, NY 10016
212.689.6549
Fax 212.684.6577
noyes@igc.apc.org Kinder, Lydenberg, Domini & Co.
530 Atlantic Avenue, 7th floor
Boston, MA 02210
617.426.5270
www.kld.com
Social Investment Almanac Studies in the Field of Socially Responsible Investing
www.SRIstudies.org Social Investment Forum/Coop America
1612 K Street, NW, Suite 600
Washington, DC 20006
202.872.5319
800.58.GREEN
www.socialinvest.org
www.coopamerica.org SocialFunds.com
www.socialfunds.com
Information and resources for socially responsible investing top Catalogues/Books Franklin Insight
Trillium Asset Management
711 Atlantic Avenue
Boston, MA 02111
617.423.6655
www.trilliuminvest.com
Investment guide now available on website only National Green Pages Co-op America
800.58.GREEN
www.coopamerica.org
Environmental organization and product listings Shopping for a Better World
Council on Economic Priorities
800.729.4237
www.cepnyc.org top Vendors Message! Products
P.O. Box 64800
St. Paul, MN 55164-0800
800.243.2565 800.790.6684 fax www.messageproducts.com
Order bank checks, labels and other products and a percentage goes to the non-profit of your choice Working Assets
701 Montgomery Street, 4th Floor
San Francisco, CA 94111
800.522.7759
Credit Card and Long Distance Phone Services that donate to non-profits |
