M3: Jeff Next Steps

Aware/no-harm/ESG public equity investments

There’s one area that I see as the next learning area for me after this workshop: shifting public equity investing investments to aware/no-harm (divest from fossil fuels)/ESG investments.

First, I know this workshop sets out a bolder vision for using CST to move assets into impact/regenerative investments.  I’m working to move some personal and foundation assets in this direction.  But I’m reluctant to move all my personal assets today.  I feel that I need to move towards the workshop’s vision through an intermediary step. (It’s good to run a marathon before you run a 100 miler!) Moving to aware/no-harm/ESG public equity investments seems to be that step.  Beyond me personally, it seems like the right way for me to lead a foundation. It’s a big leap from unaware investing to 5% of our assets in PRI’s (where we are today) to 100% mission-aligned assets.  I see the first step is to 1) educate myself, so that I can 2) recommend educational opportunities for the board/investment manager, 3) better understand if we can use consultants and our existing investment manager or should start looking for a new investment manager, and 4) create a strategic plan for moving our public equity investments to be more mission-aligned before my board term ends this year.

Questions for the group:

  • Do you think this is the right next step for a foundation in our position?
  • Where do I learn more about aware/no-harm/ESG/CST public equity investments? Groups? Courses? Websites? etc.
  • Does anyone share my interest and want to work with me?

Peer Group

  1. I would like to work with other people from the workshop that want to create a way to share deal flow.
    1. I am part of FADICA (Foundations and Donors Interested in Catholic Activities).  I talked to another member John O’Neil and he is very interested in sharing deal flow amongst potential investors.  I talked with Maddie at FADICA (part of the larger group) and she was going to give some thought to FADICA’s role.
    2. FYI, FADICA is hiring someone to lead their Mission Driven Investing effort, i.e. to walk with and guide foundations on their impact investing journey.  If you know someone, here is the job description: https://www.fadica.org/about/job-openings/staff
    3. It was great to read that CIIC is interested in this same work.
    4. I would suggest we coordinate with FADICA, CIIC, and anyone else in this group that is interested in impact investing deal flow.  I would be happy to coordinate a meeting.
    5. Question for the group: who else is interested? Let me know and I can organize a group call.  Or if someone else is already doing this, I would like to join the group.

Personal

  1. Review and likely join Marco’s May workshop
  2. Invest 2% of my assets in investments discussed during this workshop by May 15 (0.7% already invested with RSF Social Finance).
    1. I am looking at Apis & Heritage.
    2. I would like to join the group that is doing due diligence on the Kachuwa Impact Fund.
  3. Internal work: I’ve been ignoring this for too long.  I need to work on overcoming the fear I have of making bad decisions with my money and develop a better relationship with my personal wealth.  I don’t have a specific plan, but a conversation with Tracy (Wisdom & Money) might make sense.
    1. Question: what was the group mentioned in one of the Module 3 talks/readings that helps generational wealth transfer?
  4. Continue with the peer group that Felipe connected me with before the workshop started.
  5. I hope that I can continue the conversation

Professional

  1. Flush out CST framework for Catholic solar projects.  This is where I can best apply the CST framework from this workshop to the Catholic solar fund I’m putting together. (still haven’t fully done this yet)
  2. Are solar projects extractive for the church/facility?  
    1. Model out the sources and uses of funds and financial benefits for all parties.
    2. Evaluation against Seed Commons Model (and Demand Dividend model?)
    3. Share my analysis with the group by 3/31/21

Foundation

  1. Shift foundation cash assets to a bank that reflects the foundation’s values and mission. (Thanks Sarah Smith for mentioning to me such a simple step.)  Timeline: 2 months
  2. Explore moving some of the fixed income portfolio to municipal bonds in the communities that Opus works so that we are aware of where our portfolio is (from Marco’s talk).
    1. Week of March 22: discuss with investment manager and bring up to board
    2. If board-interest, task investment manager to come back with recommendations in 6 weeks, with a check-in half way through with investment manager
    3. June board meeting: while approval isn’t required, get board’s buy-in on this shift.  Ideally, have a couple investments made if board was excited in March board meeting.
    4. By September board meeting, have shifted x% of fixed income portfolio to local municipal bonds
  3. Ensure that impact investing strategy that we discuss at next week’s board meeting (with Stephanie Gripne from the Impact Finance Center) gets translated into an action plan (and some action!) for our June board meeting.

3 thoughts on “M3: Jeff Next Steps

  1. Hi Jeff – Great next steps! Few quick misc thoughts in response to some questions:

    1. I think starting with move to positive ESG in public portfolios is a great first step. That is what we did first as well. Our legacy investment advisors did not have the appetite, experience, knowledge to do this so we had to find one that did. I can share thoughts if you are interested.

    2. @maggiestohler can confirm, but I believe FADICA and CIIC are already in conversations and collaborating.

    3. Resources re: ESG – I have not read this paper but recently heard it mentioned as a meta review of over 1000 papers on the financial impact of ESG investing https://www.stern.nyu.edu/experience-stern/about/departments-centers-initiatives/centers-of-research/center-sustainable-business/research/research-initiatives/esg-and-financial-performance

    I believe NYU also has an ESG/sustainable investing course online. I have not done, but they seem to produce good research.

    4. I’d be curious to see the conclusions of your work on CST and solar when you have them!

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  2. Yes, @kdlyons. CIIC + FADICA have been working for some time to collaborate on resource sharing. This may look like FADICA joining CIIC as a member, or becoming working partners so that FADICA members have some access to CIIC resources. While still in development, there is definitely a coalition growing.

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  3. Jeff – your comments around coordinating impact investing deal flow sparked a memory about a map the St. Louis startup ecosystem created to help people figure out where different groups fit into the bigger picture. Perhaps I am overly visual, but it really helped me:
    https://entrepreneurquarterly.com/innovation-districts/

    I would love — and will volunteer to put time in if there’s interest — to see something similar for the CST ecosystem. I think this could be a helpful way to grease the skids for our space and compound the effectiveness of our networks.

    Like

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