Consumer Health Foundation

Managing and growing CHF’s portfolio of investments is a critical responsibility of the board and staff. After all, it is these investments that finance the Foundation’s grantmaking and other activities to improve the health and health care of our community.

CHF is part of a small, but growing movement in philanthropy to use investments as more than just a funding stream for community grantmaking. The investment process itself can be a strategic tool for supporting the foundation’s mission. This is known as mission-related or mission-consistent investing. CHF and other foundations across the country are working together to identify mission-consistent strategies and investment tools through a new campaign, More for Mission Investing.

Following is a summary of the actions CHF has taken over the years in support of mission-consistent investing:

Investing in Local and Minority Fund Managers

Very early on in the foundation’s history the board expressed an interested in supporting mission-consistent business practices. This included using local minority contractors for catering, office supplies, and other internal services, but was eventually expanded to include minority fund managers. Since that time, the board and staff have worked closely with the Foundation’s professional investment advisors to aggressively support and promote the role of minority-owned money management firms and senior minority managers in other firms.

Screens for Harmful Industries

Shortly after the board and staff began discussing minority fund managers, they started to look at prohibiting investments in industries and corporations whose business practices ran counter to a public health-driven mission. These are called screens on investments. In 1997, the board passed a resolution prohibiting CHF’s investment in tobacco-related securities. In 1999, the board decided to also screen for manufacturers of firearms.

Program-Related Investments

In 2000, CHF President Margaret O’Bryon introduced another mission consistent investment strategy to the Foundation’s board. CHF could invest in low-interest loans to local nonprofit partners who were working to fulfill the foundation’s mission. The board was particularly excited about the opportunity to use these Program-Related Investments (PRIs) to support the growth and development of high quality nonprofit health care clinics. The Foundation made its first PRI ($750,000 loaned at 1% over 15 years) in 2000 to a local intermediary, the Local Initiatives Support Corporation. In 2005, CHF made a second PRI to the Nonprofit Finance Fund, which helped launch the DC Primary Care Association’s Medical Homes DC initiative, a clinic-based quality and capital improvement project. 

Socially Responsible Investments

Since 2000, CHF has also sought out socially responsible fund managers. These are fund managers who intentionally integrate social and/or environmental criteria into their financial analysis process. CHF currently holds a significant investment in the Calvert Group, a large socially responsible fund manager based in the Washington metropolitan region.

This series of incremental steps and actions in mission-consistent investing culminated in a strategic decision in 2006 to amend the Foundation’s Investment Policy Statement. CHF’s goal statement, including the new mission-consistent language in italics, now reads: 

The Trustees feel that grants to be made in the future are as important as grants made today.  This is consistent with the philosophy that this Foundation is to exist in perpetuity, and therefore, should provide for grant making in perpetuity.  To attain this, the overriding financial goal of the Foundation is to maintain purchasing power.  That is, net of spending, the goal is to increase the aggregate value of Foundation assets at a rate at least equal to the rate of inflation over the Foundation’s investment horizon.  It should be stressed: CHF’s investments will be made, to the extent feasible, in a manner that is consistent with CHF’s mission to improve the health status of Washington, DC area communities – particularly the most vulnerable members of those communities – and with CHF’s fundamental commitment to a marketplace that encourages social responsibility, social justice, diversity, and sustainability. 

It is important to note that the tremendous progress CHF has made in mission-consistent investing has been years in the making and has involved significant discussion and debate. But throughout the process, both the board and staff have been open to exploring new ideas and to engaging in good, challenging conversations. We see all of our work to date, including our mission-consistent investment practices, as parts of Chapter One – the first episode of many as we build the competency of the Consumer Health Foundation to “make a difference” in the life of our community.