Impact Investment Strategy
Targeting Impact Investing, Prioritizing ESG (Environment, Social, Governance) Indicators
Sundance Family Foundation is a private family foundation located in St. Paul MN. It’s mission is to “strengthen youth development and support family stability.”
Impact Investing is an investment strategy which seeks both a financial return while accomplishing social good. Impact Investing considers Environmental, Social, and Governance criteria (ESG) to quantifiably measure sustainability and social impact on society through a company, business, or fund. Sundance utilizes industry-agreed ESG criteria to create a measurable assessment of true social impact over time.
Doing Well While Doing Good: Sundance Family Foundation
Co-Founder and Sundance Family Foundation President and Executive Director Nancy Jacobs, along with an engaged Sundance Board of Directors, strives for portfolio investments that obtain a double bottom line return on investment (ROI). A double bottom line provides a market rate or better financial return and an equally clear and measurable social good return. Sundance welcomes the opportunity as well, to invest in funds that create a triple bottom line which provides positive financial, social and environmental impacts.
Sundance adheres to a values-based, empowerment model of philanthropy. The Foundation’s supportive grant making is exemplified in its support of 501(c)(3) organizations providing Housing for Homeless Youth and Families and its Youth Social Entrepreneurial programming.
See www.sundancefamilyfoundation.org for guidelines and information.
Beyond its grantmaking, YSE research, and programmatic support, Sundance has activated its Foundation endowment to participate in investing towards the the greater good. Over the past five years, while investing in socially impactful funds, Sundance Family Foundation has achieved double and triple bottom line returns, often beating commonly used investment benchmarks including the S&P 500 and the Russell 2000. Sundance has used a four-phase process over five years to implement a robust Impact Investment portfolio. Sundance has and continues to adhere to an endowment investment model which fundamentally ascribes to broad diversification and competitive market returns. This strategy was developed in the following manner:
Phase One/Year One: Sundance started with Equity Investments using Mutual Funds and Exchange Traded Funds
BENEFIT: Broad diversification with a focus on one or all of the ESG criteria was achievable using these vehicles.
Phase Two/Year Two: Sundance added Fixed Income using Mutual Funds and Exchange Traded Funds
BENEFIT: Broad diversification with a focus on one or all of the ESG criteria and special emphasis on areas such as Microfinance, Community Development and Housing.
Phase Three/Year Three: Sundance added professionally managed portfolios of Individual Stocks and Bonds
BENEFIT: Individual securities customized to the values of Sundance, and the ability to engage the board in Shareholder Advocacy to effect impactful change within publicly traded corporations was achieved. (As an example, please refer to the Shareholder Advocacy Program at Trillium Investments: www.trilliuminvest.com/approach-to-sri/advocacy-policy/
Phase Four/Year Four: Sundance added High Impact/Semi-Illiquid Investments
BENEFIT: New frontiers of small and medium enterprises (SME)s served to further diversify the Sundance portfolio. Illiquid Impact Investments are often placed into emerging market funds that supply growing small- and mid-cap businesses run by experienced management teams with expansion capital. These entrepreneurial businesses are positioned for growth, evidence stable positive cash flows and positively impact their communities.
Building A Community of “Greater Good” Investors
Sundance Family Foundation is an Impact Investment Foundation Leader by aligning its investments with its core values. Over a period of five years, the Foundation has transformed its investment corpus from a financial return model to one targeting financial and social good in equal measure, an ROI that results in a “double bottom line return. As a result, the current Sundance Family Foundation has an investment portfolio with 85% of its corpus investments in alignment with its values and mission.
For more information on developing a values-based investment strategy, please contact Nancy Jacobs, Co-Founder and President of the Sundance Family Foundation at Nancy(at)SundanceFamilyFoundation.org
Sundance Family Foundation
944 Grand Ave
St. Paul MN 55105
612 822 8580
Note: The Minnesota Council on Foundations published an article in the Spring 2014 Newsletter featuring the Sundance Family Foundation as follows:
The Sundance article in Giving Forum: http://www.mcf.org/news/giving-forum/sundance-impact