Tuesday, October 21, 2014
F.B. Heron Foundation Earmarks Entire Endowment for Social Impact Investments
When Clara Miller took over the F.B. Heron Foundation, which focuses on fighting poverty, she was unhappy with what she saw.Not only were U.S. poverty rates stubbornly high, but income inequality also was on the rise.
So she took a rare, if almost unheard of, step in the foundation world—where typically only 5% of endowment principal is doled out to charity every year.Heron would move its entire $300 million endowment into investments that provide both social and financial returns. By the end of this year, 63% of Heron’s funds will be invested in such vehicles. Ms.Miller hopes to be 100% invested in social-impact causes by 2017.
That is a major departure from the typical foundation strategy of using the endowment solely to generate financial returns to fund grants to nonprofits. Heron is making the shift at a time when other foundations, as well as governments and corporations, are trying to find investments those benefits extend beyond the financial....
