Former President, F.B. Heron Foundation
MI Strategy
Developing a mission investing strategy is the first step in taking up the practice. A foundation may begin the process by conceptually thinking about how they can integrate their investments with their program strategies to achieve greater impact and fulfill the mission of their organization. A foundation may have a broader philosophical strategy. For example, in the case of Meyer Memorial Trust their mission strategy is based on total foundation management including, “corpus, payout, and intellectual capacity” and mission investing is integrated into that strategy. Factors to consider include:
- The foundation board’s desire to adopt a mission investing strategy,
- The board’s comfort level with the philosophy of aligning their investments with the mission of the organization, whether part of the 5% payout or the endowment,
- Asset class parameters in accordance with strategic portfolio asset allocations, an organization’s capacity to execute on the strategy that includes sourcing deals and due-diligence and the ability to monitor triple bottom line performance.
In determining a strategy and approach to mission investing a foundation thinks about the spectrum of mission investments and how their mission and program strategies align. The "Mission-Related Investing Continuum" developed by Luther Ragin of the F.B. Heron Foundation illustrates the spectrum of mission investments available. At each end of the spectrum are varying levels of risk and associated returns—below-market and market-rate. A foundation has the ability to assess opportunities across the entire spectrum and pick investments that make the most sense based on the foundation’s broader mission investing strategy.
