Winter 2013-14

Responsive Philanthropy Winter 2013-14


Written by: Aaron Dorfman

Date: January 13, 2014

Dear Readers,

Like many from my generation, one of the activist campaigns that was most formative to my early understanding of social change was an effort to convince my college (Carleton College in Northfield, Minn.) to divest from investments in South Africa that supported a brutal regime of apartheid. How could our school, which supposedly stood for racial equality, justify making money from investments that perpetuated injustice?

That experience is part of why I’m pleased to put forward this special issue of Responsive Philanthropy focused entirely on mission investing (MI). Foundations control more than $700 billion in assets. What are they doing beyond the 4 or 5 percent given out as grants each year to leverage the power of those assets in pursuit of mission?

In the cover story “Improving the Planet and Walking the Talk,” Park Foundation staff and trustees write about the organization’s journey in mission investing. They offer insights on the variety of tools they utilize to align the foundation’s investments with its mission.

Tim Smith, director of environmental, social and governance shareowner engagement of Walden Asset Management, addresses one of the most common concerns about MI: that the practice violates foundation trustees’ fiduciary duty. In “Blending Mission, Values, Fiduciary Duty and Investment,” Smith argues that fiduciary duty should be a “motivating force” instead of an excuse for inaction.

In “Pushing the Envelop,” Peter Berliner, managing director of Mission Investors Exchange, and David Wood, director of the Initiative for Responsible Investment at Harvard University, offer ways that foundations can do more to maximize what’s possible in mission investing.  They also highlight key challenges to the practice of MI and what foundations can do to support innovation and continued growth in the field.

Global Impact Investing Network’s Amit Bouri, managing director, and Abhilash Mudaliar, research manager, write about catalytic first-loss capital and how it can lessen risk and incentivize potential impact investors such as foundations that would like to test the waters.

“Pooled Funds: The Invisible Wall Between Your Foundation and True Mission Alignment,” by Dana Lanza, CEO, and Sarah DeNicola, membership program manager, of Confluence Philanthropy, shines light on the limitations of pooled funds and how these prevent foundations from exercising influence and aligning investments with values.

In this edition’s Member Spotlight, the W.K. Kellogg Foundation talks about its Mission Driven Investment program. It offers lessons and tips for other foundations from its own experience in emphasizing both social and financial returns in its investments.

Rounding out these rich articles from the field of mission investing is a handy list of resources that you can turn to for tools, expert advice and events that may help you navigate the world of mission investing.

We hope that this special edition of our journal contributes to the evolving discussions on MI and helps expand the number of foundations that engage in this high-impact investing practice.

We appreciate hearing from you. Send a note to and tell us what you think of this and other issues of Responsive Philanthropy.


Aaron Dorfman

Executive Director