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Investment philosophies focused on social
impact have many names…
• Socially Responsible Investing
• Sustainable and Responsible Investing
• ESG (Environment, Social, Governance) Investing • Impact Investing
• Socially Conscious Investing
• Double or Triple Bottom Line Investing • Ethical Investing
• Mission-related Investing • Green Investing
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Investors interested in social AND financial
returns are numerous and diverse.
Individuals
Banks and Credit Unions in low- and middle-income communities Foundations Religious Institutions
Venture Capitalists & Private Equity Investors
Pension Funds Colleges and Universities
Investment Management Firms Institutions
Money Managers
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The industry is growing rapidly, and expected
to continue on this path.
The total US-domiciled assets under management using socially responsible strategies
expanded from $3.74 trillion at the start of 2012
to
$6.57 trillion at the start of 2014, an increase of 76%.
These assets translate into
1 out of every 6 dollars
under professional management.
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The industry has three main segments:
Environmental, Social &
Governance (ESG) Integration
Impact Investing
Shareholder Engagement &
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ESG integration evaluates public companies on
factors that align with investor interests and
affect how a company is run and performs.
• Fund managers select publicly listed securities that have certain environmental, social and governance (ESG) attributes.
– Negative screens exclude objectionable business practices:
• Animal testing, tobacco production, poor environmental performance, military weapons productions, gambling, irresponsible foreign operations, terrorist regimes – Positive screens identify companies with admirable business practices:
• Environmentally friendly practices, healthy living and environmentally friendly products, workplace practices and diversity, animal rights
– Best-in-Class strategies identify companies in somewhat questionable industries (oil & gas) with ESG policies that are superior to their industry peers.
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Shareholder advocacy aims to improve the
social policies of public companies.
• Main goal:
• Shareholders encourages companies to adopt or improve their environmental, social and governance practices.
• Engage in direct dialogue with
executives
• Issue shareholder resolutions
• Participate in proxy voting
• Deliver congressional testimony
• Attend annual shareholder
meetings
• Environment and climate change
• Corporate governance and ethics
• Corporate disclosures (ex.,
political contribution and executive pay)
• Diversity and women in the
workforce
• Human and labor rights
Sample Focus Areas Shareholder Activities
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The number of voices engaged in shareholder
advocacy is increasing.
• From 2012 to 2014, 175 institutional investors and 27 investment
management firms with total assets of $1.72 trillion filed or co-filed resolutions.
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Impact investing aims to improve
communities underserved by conventional
financial services.
• Impact investments are made:
– with the intent to deliver both social AND financial returns;
– in multiple asset classes and are often private investments; and
– into companies, organizations and funds often focused on low-income communities, in both developed and emerging markets.
The ultimate goal of community
investing is to enable a sustainable
solution to the world’s most pressing
social challenges by empowering people
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Defining characteristics of
impact investing:
Intentionality
Financial
Return
Measurable
Impact
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Community investing has grown rapidly due its
proven ability to benefit under-resourced
populations.
Source: US Social Investment Foundation, 2014 Trends Report
• A total of 880 community investing institutions, including community
development banks, credit unions, loan funds and venture capital funds, collectively manage $64.3 billion in assets.
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Community investing typically targets sectors
that have challenges attracting capital.
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Calvert Foundation’s Impact
“My interest and action lie in doing things where there’s a multiplier effect. I
know that my investments make an impact over and over, in communities where
people live and work everyday.”
-- Tim Wheeler, Durango, CO Small Business Owner and Investor since 1995
3,400
Affordable housing units financed120,000
Microfinance customers served80
Countries served3,800
Jobs created or maintainedOver the past three years alone, our investors have enabled us to create the following impacts:
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Calvert Foundation focuses its investment
on specific issues areas:
• Calvert Foundation’s Community Investment Note investors can support:
– Affordable Housing – Education
– Small Business
– Women’s Empowerment & Clean Energy (WIN-WIN) – International Microfinance
– Fair Trade
– Ours to Own: Denver – Ours to Own: Twin Cities – Ours to Own National
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Impact: Affordable Housing
• Investment in the Affordable Housing initiative supports Calvert
Foundation's portfolio of organizations that develop affordable housing projects, which are critical to families’ economic and social wellbeing.
Real-life Impact:
AHC Inc. is a non-profit developer of affordable housing in the Mid-Atlantic region that provides quality homes for low- and moderate-income families. In an effort to offer educational services to strengthen residents’ economic and social stability. AHC Inc. holds a summer camp for its more than 100 low-income elementary students specifically designed to prevent learning loss. The
program is working – last year 93% of students showed no summer learning loss and 46% showed summer reading gains.
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Impact: Education
• Access to a quality education has been shown to be the most effective route to increasing lifelong earnings and escaping poverty. Investment helps finance the construction and growth of charter schools that
provide quality education, often in disadvantaged communities.
Real-life Impact:
Investment capital allowed the Camino Nuevo Charter Academy to transform an unused maintenance facility in Los Angeles into a thriving school that is achieving
academic success. Its students, whom reside in some of the most historically under-served areas of Central Los Angeles, have outscored the rest of the state of California on the Academic Performance Index (API), which
measures California schools based on how their students perform on the California Standards Tests (CST).
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Impact: Small Business
• Small businesses are a major employment engine of the U.S. economy and are essential to thriving local economies. Investment helps provide the working capital business owners need to grow, creating jobs and fulfilling critical needs in communities.
Real-life Impact:
Tri-State Restaurant Supply, a supplier of specialty kitchen and coffee supplies, was hit hard by the recession. When owner Jim Bliss learned he was not eligible for bank financing, he turned to Montana Community Development Corporation's (CDC) Small Business Development Center. The Center worked with Jim for over a year to overhaul his business and become eligible for financing from Montana CDC. Today, Tri-State Restaurant Supply employs 14 staff with offices in two cities and continues to serve the entire state of Montana.
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Impact: Women’s Empowerment
• Women Investing in Women Initiative (WIN-WIN) empowers women around the world to be agents of their own economic power and
opportunity. WIN-WIN supports organizations that empower women through access to financing, healthcare, housing, and education.
Real-life Impact:
Women Organizing Resources, Knowledge, and Services (WORKS) is creating safe affordable housing in at-risk neighborhoods in Los Angeles. WORKS transformed a gang and drug ridden area into Highland Village. The renovated housing development includes a Community Center that offers a variety of programs including ESL classes, after-school tutoring, and computer instruction at no cost to the residents and neighbors.
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Impact: International Microfinance
• Investment in the International Microfinance initiative will provide
entrepreneurs in developing countries the capital they need to start or expand microbusinesses, putting them on the path towards long-term economic progress.
Real-Life Story:
Fanira Mammadova took her first loan from WorldVision
Azerbaijan in 1999 to raise chickens. She later took out loans for animal husbandry and to set up a small shop. Thus far, she has taken 12 loans, mostly to grow family businesses, that have brought her family out of poverty.
At the end of 2013, VF AzerCredit had 74,372 active
borrowers like Fanira with a total portfolio of $71.8 million. In 2012, the loans disbursed by VF AzerCredit helped create 817 new jobs and sustain another 115,884.
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Impact: Fair Trade
• Investments targeted to Fair Trade will help small farmers, mainly in coffee and cacao cooperatives, create more environmentally and
financially sustainable livelihoods for themselves and their families.
Real-life Impact:
Calvert Foundation in partnership with Alterfin, a Belgian development finance cooperative, provides critical capital to coffee and cacao cooperatives. The Divisoria cooperative in Peru connects small coffee farmers with financing and access to
markets.
Luis joined the Divisoria cooperative when he switched from growing coca, the base ingredient of cocaine, to coffee due to the increased coca-related violence. With the increased revenue from his organic coffee, he now has a new roof for his house and has just invested in a facility to process harvested coffee beans.
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Impact: Ours to Own – Denver
• The Ours to Own: Denver initiative allows people to invest in small businesses and community development throughout the Metro Denver region.
Real-life Impact:
The Urban Land Conservancy (ULC) works to preserve important community spaces for community benefit. ULC has transformed Holly Square in Northeast Park Hill into a vibrant community center that includes a Boys & Girls Club, a local non-profit that is training and empowering the neighborhood’s youth, and Peace Courts, where kids of all ages can run around and shoot hoops.
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Impact: Ours to Own – Twin Cities
• The Ours to Own: Twin Cities initiative allows citizens to invest in small businesses that are creating jobs and opportunity throughout
Minneapolis and St. Paul.
Real-life Impact:
Through the Ours to Own initiative and the Community Reinvestment fund, a local partner, Gloria was able to receive financing to expand her business, Olu’s House, a licensed care organization that provides residential and in-home services to the elderly and persons with developmental disabilities or mental illness. Gloria has purchased a new facility and now employs nearly 100 people.
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Impact: Global Good
• An investment in our Global Good initiative will be put to use where it's most needed in our portfolio of nonprofits and social enterprises, and will contribute to creating a range of social benefits.
Real-Life Story:
Bubbly Dynamics is transforming an abandoned
meatpacking factory into a vertical farm and sustainable foods business incubator called "The Plant" with a
$540,000 working capital loan from Calvert Foundation portfolio partner Chicago Community Loan Fund (CCLF). The project, which will convert its own waste into biogas to heat and light the building, will also bring local foods to Chicago’s Back of the Yards neighborhood, a
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How impact investing works
at Calvert Foundation:
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Additional Impact Investing resources:
• The Forum for Sustainable and Responsible Investing (US SIF) – A
professional association focused on sustainable, responsible and impact investing that offers a financial director of investment products
• Global Impact Investing Network (GIIN) – Organization dedicated to
improving the effectiveness of impact investing that offers resources for investors
• Impact Assets 50 – A selected list of 50 impact investing fund managers
• Invest for Values – A resource on the different investment products that
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About Calvert Foundation
• Calvert Foundation is a 501(c)(3) organization that has been a pioneer in the impact investing space.
• In 1995, Calvert Foundation created the Community Investment Note, a fixed income product through which investors can help provide
economic opportunities around the world.
• In almost 20 years, more than 15,000 investors have collectively invested over $1 billion dollars.
Community Investment Note
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Community Investment Note
Investment type Fixed income
Minimum Investment • $1,000 direct or through brokerage account • $20 online at Vested.org
Financial return 0–3% at terms of 1–10 years
Social return Measured annually by sector-specific indicators, and
reported to investors through Calvert Foundation’s Social Impact Report and quarterly updates
Liquidity Notes should be viewed as an investment to be held to
maturity, but Calvert Foundation may allow early redemption and partial withdrawals
Expenses None; Investor dollars are not used to pay sales
commissions, existing debt, or any other Calvert Foundation expenses
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Performance
100% repayment on investor principal and interest through: Diversified Portfolio:
– 100+ nonprofits and social enterprises with strong management, operations, financials, and capitalization
Professional Management:
– Industry-leading due diligence and monitoring – Over 98% underlying portfolio repayment rate
Security Enhancements:
– Over $45 million in sub debt, loss reserves, and net assets
*Past performance is no guarantee of future results. As with all investments, there is risk. Please read our prospectus before investing.
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Current Portfolio
24% 25% 27% 18% 6% Funding by SectorAffordable Housing Community Development (U.S.) International Microfinance Social Enterprise
Fair Trade
60% 40%
Geographic Impact
International Domestic
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Learn More
For more information about how Calvert Foundation can help you meet your social and financial goals:
www.calvertfoundation.org
Phone: 800.248.0337
info@calvertfoundation.org
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Disclaimer
Calvert Social Investment Foundation, a 501(c)(3) nonprofit, offers the Community Investment Note, which is subject to certain risks, is not a
mutual fund, is not FDIC or SIPC insured, and should not be confused with any Calvert Group-sponsored investment product. This document is neither an offer to sell nor a solicitation of an offer to buy these securities; the
offering is made only by the prospectus, which should be read before investing. Due to Blue Sky regulations, the current offering of the
