Invest with Values

The Investor's Gateway to Positive Change

The Investor's Gateway to Positive Change

  • RESOURCE DIRECTORY
    • GETTING STARTED
    • FULL DIRECTORY
    • Top Resources
    • Share a Resource
  • NEWS CENTER
    • NEWS CENTER
    • By Category
      • Local Banking
      • Community Investing
      • Impact Investing
      • Sustainable-Responsible Investing
      • Featured Articles
      • Beyond Investing
      • IWV news
      • Top Resources
    • News Partners
      • 3BLmedia
      • AllianceMagazine
      • CorporateKnights
      • GreenMoney
      • Locavesting
      • MaxImpact
      • InvestWithValues Sponsors
      • InvestWithValues Partners
    • Newsletter Sign-up
    • Newsletter Archive
  • About
    • About Us
    • Brian Kaminer
    • Learn More
    • Testimonials
    • Investments Talk! Video
    • Launch Press Release
    • News Center Press Release
  • Sponsors & Partners
    • Sponsors
    • Partners
  • Connect
    • Contact Us
    • Survey
    • IWV News
    • Share a Resource
  • Spoiler title
    Free GuideSubscribeClose
    Get a free 30 minute personalized guide to
    Invest With Values, after subscribing.
    * = required field

Breaking the iron curtain between investing and grant-making

May 31, 2016 By AllianceMagazine

Private companies have the purpose to make money. Civil society organisations want to do good. Foundations need to do both – make money through investing their endowment, and contribute to social change, based on their values and mission.

This hybrid character of foundations – the challenge to match the mission with the need to make money – can lead to contradictions. This is especially the case if foundations want to contribute to tackling the interconnected root causes of the multiple crises the world is facing today, may it be climate, migration, civic space or inequalities, to mention just a few. As Matthieu Calame, director of the Charles Léopold Mayer Foundation said: “When you want to be transformative, you have to face your own contradictions, which is very uncomfortable. It’s easier to do charity!”

The question of the “iron curtain” between grant-making and financial asset management was at in the very centre of the discussion in the session “To divest or not to divest – What is the question?”, which took place at the European Foundation Centre Annual General Assembly on 26 May 2016. In many foundations there is no alignment of the investment policies with the values and mission of the organisations – an absurd situation, considering that the impact of investments is much higher than the effects of the grant-making – simply because of the much higher amounts of money involved. But many foundations still tend to manage their capital mainly along financial considerations. Though t

There are of course a few negative investment criteria in most foundations, such as excluding investments in tobacco, gambling or pornography (76% of British foundations have some kind of negative screening, according to research presented by Kate Rogers from Cazenove Charities). Still the percentage of foundations divesting from fossil fuels still remains marginal.

For Boudewijn de Blij from Fonds 1818, the priority was clear: “We want market returns to spend it through grant-making. The people we give the money to are not interested in how we make our money!” But what if the impact of the investments contradicts the mission and values of the foundation? This is where foundations have a responsibility to break the iron curtain between financial management and grant-making, and think about how they use their money – both grants and investments – more holistically.

There are great examples of impact investment, for example within the social and solidarity economy, showing how foundations can use their assets pro-actively to support their mission – ideally in close collaboration with their grantees and social movements. The German Bewegungsstiftung (Foundation for Social Movements) for example has ambitious “Ethical Investment Guidelines” since its creation 13 years ago. And at EDGE Funders Alliance (“Engaged Donors for Global Equity”, a transatlantic network for systemic change philanthropy), the Ethical Investment working group is exploring this question through a series of webinars, where foundations can discuss these challenges between peers.

Kate Rogers said in the session that they chose the title “Intentional Investing” for their report, instead of talking about “ethical” or “responsible” investment, as this would imply that conventional investments would be “unethical” or “irresponsible”. Well, I’d say that this is what they really are: it is irresponsible in 2016 to continue financing the fossil fuel industry, and unethical for value driven organisations to perpetuate extractivist capitalism through investments solely based on financial considerations. Investments are always “intentional”, but unfortunately too often the sole intention is to maximise return.

In order to increase the impact and leverage of philanthropy to address today’s challenges, we have to break the iron curtain between grant-making and investment, and introduce ethical criteria systemically in the management of the capital.

Tobias Troll
EDGE Funders Alliance
Director, EDGE Europe
tobias@edgefunders.org

Share This:

This post was originally published on AllianceMagazine.org


home-compass-croppedVisit the Invest With Values - Resource Directory to access leading investor information, opportunities, organizations, events, groups and tools.

Filed Under: -Impact Investing

About AllianceMagazine

Alliance magazine is the definitive resource for all philanthropy and social investment professionals worldwide. It provides news and analysis of what's happening in this sector and is the only magazine of its kind with a global focus.

Invest with Values readers are eligible for a 20% discount (new subscribers only) on subscriptions to Alliance magazine. Simply enter partner20% at the checkout to claim your discount.

Learn more about AllianceMagazine and their articles.

News Search

Sponsors

Talgra RSF RSF Social Finance logo Trillium MicroVest MicroVest LOCUS LOCUS Impact Investing CFC capital for change

Events

All News by Category

Take the Survey

Why do you care about money and investing?
  • Home
  • Directory
  • News Center
  • Sponsors & Partners
  • About
  • Connect
  • Google Plus
  • Facebook
  • Twitter
  • Linkedin

Copyright © 2025 • Invest with Values • All Rights Reserved • 914-230-0741 · info(at)talgra.com
Created and Managed by Brian Kaminer of Talgra LLC

Disclaimer: The information shared through investwithvalues.com has been provided by Talgra, LLC (“Talgra”). No representation or warranty, expressed or implied is made by Talgra, the sponsors, partners or contributors as to the accuracy or completeness of the information contained herein. The website is for educational and informational purposes only and is subject to change. This does not constitute an offer or a solicitation to purchase or sell any security, and nothing herein should be construed as such. The opinions represented in this directory are those of Talgra and should be considered in conjunction with advice from a professional advisor in the context of your particular investment situation. The specific investments included in this website are examples of investments that can be made in each of the different investment categories and are not recommendations to purchase any individual security or investment vehicle.