ESG Newsletter

Established in 1924 by Sebastien Kresge, founder of S.S. Kresge Company which became Kmart, the Kresge Foundation seeks to expand opportunities in the United States' cities. The organization had an endowment of $3.7 billion as at December 31, 2018.

In 2015, the Kresge Foundation's Board of Trustees chose to complement its grant-making activities with impact investments through loans, deposits, equity and others. The organization's goal is to deploy a $350 million pool of funding by 2020 on programs such as health care clinics, affordable housing, social service providers and real estate to advance economic development. As of 2019, the Foundation had $251 million of committed capital to program and mission-related investments.

Social Investment Practice

Annual Report - 2018

Case Study – Omada Health

Case Study – East Jefferson Development Corporation

Case Study – Detroit Development Fund

Created in 1964 by David Packard, co-founder of HP, and his wife Lucile, the David & Lucile Packard Foundation supports organizations seeking to improve the lives of children, enabling the creative pursuit of science, advancing reproductive health, and conserving and restoring the earth’s natural systems. As at December 2018, the Foundation had $7.6 billion of assets under management.

Since the 1980s, the David & Lucile Packard Foundation has been leveraging impact investments to expand its grant-making activities. The organization has invested over $760 million on both nonprofits and for-profits since launching their Program-related and Mission-related investment programs.

Mission Investing Program Overview

Mission Investments at the Packard Foundation

Mission Investments to Catalyze Climate Solutions

The University of California is a public university system in the state of California which includes 10 campuses. The Office of the Chief Investment Officer of the Regents manages the retirement, endowment, working capital and cash assets of the organization. As at June 30, 2019, the Office of the Chief Investment Officer had US$ 126.1 billion of assets under management.

UC Investments started structuring its approach to sustainable investing 5 years ago. Since then, it has implemented a Sustainable Investment Framework, which identifies Climate Change, Food and Water Security, Inequality, Ageing Population, Diversity, Human Rights, the Circular Economy, and Ethics and Governance as key focus areas of the investment strategy. Furthermore, the University of California set itself a goal to invest $1 billion in climate change solutions as part of the White House's Clean Energy Investment Initiative while progressively divesting from its fossil fuel assets. Finally, as an active owner, the organization has set clear voting guidelines on ESG-related issues such as diversity at the board of portfolio companies, indigenous people's rights and energy efficiency.

Sustainable Investment Framework

Voting Guidelines 2018

Annual Report 2018-2019

Established in 2000 by Bill Gates, founder of Microsoft, and his wife Melinda, the Foundation seeks to improve healthcare and reduce extreme poverty. It is the largest foundation in the world with US$ 47.8 billion of assets under management as at December 31, 2018.

In 2009, the Strategic Investment Fund was set to complement their grantmaking efforts with impact investing. The Foundation may employ direct equity investments, intermediary funds, and loans and credit enhancements. The Fund also works with suppliers of critical products (vaccines, drugs and contraceptives) to guarantee volumes of sales so they can increase production and drive costs down. 

Digitizing Payments in a Cash Economy

Financing Small Agribusinesses in Africa

Empowering Women and Strengthening Families

Founded in 1917 by John Emory Andrus, the Surdna Foundation seeks to foster sustainable communities by focusing on social justice, healthy environments, inclusive communities and thriving cultures. The Surdna Foundation had US$ 976 million of assets under management as at June 30, 2017.

In 2014, the Surdna Foundation looked at how they could use their endowment to support their mission by providing investment capital to fund innovative, market-based approaches that address systemic challenges while generating both social and financial returns. In 2017, the Foundation created a US$ 100 million fund to allocate to Mission-related Investments and Program-related Investments. 

Mapping the Journey to Impact Investing

The Nature Conservancy, an environmental non-profit based in the United States, launched in 2010 a Capital Impact Fund, with support from the Robertson Foundation, to leverage private capital for conserving ecosystems. In 2014, with the support of J.P. Morgan Chase & Co., the Nature Conservancy formed NatureVest – a dedicated conservation finance platform. Its goal is to source and deploy $1 billion of investment capital by 2021.

NatureVest's mission is to source deals where private capital is key to achieve significant scale of conservation. As such, the organization structures investments for institutional investors and high-net worth individuals. NatureVest's focus is to further the mission of the Nature Conservancy in fields such as water management, ocean protection, forest management, and green infrastructure.

Case Study – Debt Conversions for Marine Conservation and Climate Adaptation

Case Study – Green Infrastructure for Cities

Founded in 1924, Verka VK Kirchliche Vorsorge VVaG is a specialist insurer for employees in the German Church. As at December 31, 2018, the firm managed US$ 2.225 billion of assets on behalf of 50,000 beneficiaries.

Verka's investment process is based on social compatibility, ecology and intergenerational fairness. As such, the firm does not invest in businesses linked to human rights violations, child labor, pollution, corruption, controversial weapons, alcohol, coal, oil, tobacco, animal testing, nuclear energy and green genetic engineering. Further, the Fixed Income portfolio may not be invested in states that disregard political and democratic rights, corruption, climate change standards, UN convention on Biodiversity and who practice the death penalty. Additionally, Verka applies a best-in-class screen to identify companies and states whose ESG performance outperforms their peers. In September 2019, the UN PRI chose Verka in their Leaders' Group for their approach to responsible investment.

UN PRI Transparency Report – 2019

The MacArthur Foundation was founded in 1970 by John D. MacArthur, the owner of Bankers Life. The organization makes grants and impact investments to support non-profit organizations furthering social good in Chicago and across the world. The Foundation managed an endowment of US$ 6.6 billion of assets as at December 31, 2018, making it one of the largest private foundations in the United States.

In 1983, the MacArthur Foundation decided to complement its grant-making program with program-related investments, a type of impact investment that seeks to accomplish the organization's purposes. For example, the Foundation provides low-cost loans, equity investments and guarantees to community development financial institutions in Chicago and across the United States to invest in affordable housing. Furthermore, the MacArthur Foundation launched the Catalytic Capital Consortium with The Rockefeller Foundation and Omidyar Network to provide capital to facilitate additional impact investments and help achieve the UN Sustainable Development Goals.

Founded in 1992, Kåpan Pensioner is a mutual insurance society managing the occupational pension for Swedish government workers. Kåpan had over 800,000 beneficiaries and US$ 9.3 billion of assets under management as at December 31, 2018.

The public pension fund's responsible investment strategy is guided by international conventions the Swedish Parliament has signed such as the UN Global Compact, the OECD's guidelines for multinational companies, the Oslo (Cluster Munition) and Ottawa (Anti-Personnel Mines) Conventions, and the UN Sustainable Development Goals. Furthermore, security selection is done using a positive screen so that companies included in their portfolio reach a minimum threshold of ESG performance. As part of its Climate neutral strategy, Kåpan has been making investments in forestry and land to compensate the negative impact of its holdings.

Sustainability Report – 2018

Founded in 1990, PWRI is the Dutch public pension fund for disabled workers. It manages the pension for over 200,000 individuals and had US$ 9.6 billion of assets under management as at December 31, 2018.

Responsible investing has been part of the pension fund's investment policy since 2004. The external asset managers to whom PWRI allocates capital must implement their policy which includes screenings (land mines, cluster bombs and tobacco producers), ESG integration, impact investing, engagements and proxy voting. Impact investments seek to improve the climate, as well as increasing the accessibility of labor markets to individuals with disabilities. As part of its engagements, PWRI engages with portfolio companies on implementing policies and procedures to create work opportunities for disabled workers.

Exclusion List

PRI Transparency Report – 2019

ESG Engagement and Disclosure Report 2018