At the Altor Foundation we distribute half of our income to good causes and half is invested to create a long-term endowment. The aim of the endowment is to secure the future of the Foundation, so that it can continue to support good causes separately from the main business.
When it comes to investing this long-term capital we wanted to learn the lessons from the work that the main Altor business has done with other charities in the past. One of the key lessons they have taken from consulting with charity trustees, is that they rarely understand what they are investing in. They have come across some charities with environmental objectives and yet some part of their investments are in oil company shares. In this way the investment choices they are making, are undoing some of the good work of the charity. We know that capital invested has a huge impact in terms of its own carbon footprint as an example on just one negative outcome.
On a bigger scale, this lack of care about what a charity invests in, can lead to very negative headlines. The Church of England found this out the hard way a decade ago: Wonga row.
So our first choice was to screen out from our invested capital anything that was in conflict with our charitable aims.
As a charity, though, we wanted to go further and focus our investments into areas where we can create positive change. We have an objective to grow the capital but wanted to know if we could do this whilst also using the capital to achieve positive environmental outcomes. This is an easy double win for a charity, if they can use their ‘passive’ capital as well as donations to help achieve their charitable objectives.
We concluded that this was possible and have invested in a range of positive impact funds. Last year our portfolio achieved the following outcomes by being invested in this way, separately from the donations we made:
Environmental
- 90 tonnes CO2 avoided.
- 118 Mwh renewable energy generated.
- 7.8 Kw renewable energy infrastructure installed.
- 8.6 tonnes of waste recycled.
- 35million litres of waste water treated.
Social
- 85 patients treated.
- 2,000 hours of education provided.
- 26 people provided with preventative healthcare.
- 8 people in the developing world given access to Financial Services.
- 4 people in the developing world given access to Mobile networks.