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Maximizing Our Impact Through Impact Investing

November 2017
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Source; Global Impact Investing Network

Since inception, the IDP Foundation has focused on supporting innovative ways to break the cycle of poverty, whether it be by lending to individually-owned social enterprises serving the poorest families through our IDP Rising Schools Program, or through grantmaking to organizations that are strengthening communities.

In 2014, we decided that we wanted to do even more! With the core belief that charitable organizations should use all their resources for social good, we added impact investing as a way to contribute more. Impact investments are “investments made into companies, organizations, and funds with the intention to generate social and environmental impact alongside a financial return”. This model allows our foundation to simultaneously increase the financial capital available for grantmaking, while advancing solutions that are good for both people and the planet.

Just three years later, we are proud to say that we have become 92% mission-aligned with our portfolio including pure impact investments. Through this impact driven screening, we can target investment opportunities with the intention of having a positive social or environmental impact. Our success since moving into the impact investing arena speaks for itself. After tracking our portfolio beginning in 2014, we found that it has outpaced its traditional benchmark. Without forgoing financial return, we have been able to maximize our impact.

Just three years later, we are proud to say that we have become 92% mission-aligned.

How did we start investing the corpus of the Foundation with impact? We began by creating three areas of impact focus: Human Capital Management, Environmental Stewardship and Sustainable Community Impact. While keeping a diversified portfolio, we transitioned out of some traditional investments and into investments with an impact focus in one of our target areas. We invested in opportunities where both impact and market rate returns were the objective.

We then began looking more closely at the Sustainable Development Goals (SDGs) and how we could use the SDGs as a guiding force for future investments to add to our impact portfolio. It’s been an incredible journey so far, and we intend to keep chugging forward to seek new opportunities to further enhance the overall philanthropic approach of the Foundation.

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