The majority of our endowment (approximately $50 million) is invested in the Core portfolio with the primary goals of preserving capital and earning a sufficient financial return to continue our grantmaking in perpetuity. The Core portfolio is governed by our No Buy Guidelines – we refuse to own shares in companies whose actions are in conflict with the work of our grantee partners – and divested from the Carbon 200, even though these investments are not entirely in alignment with our mission and values. The bulk of the money is in traditional Wall Street investments invested across all asset classes.
Our formal investment policy for the Core Portfolio includes setting a long term horizon of 10 years, limiting risk through diversification amongst a wide range of investments and achieving a 100 percent values-aligned investment portfolio.
Swift Foundation prides itself on making pioneering, high impact investments. We are especially proud of early investments in Microvest, Guayaki, Community Capital Management and Impax New Energy Investors. Originally housed in our Transitional Portfolio, these investments have transitioned to our Core Portfolio where their financial performance and risk profile is on par with their asset class.
Our vision is that one day our Core portfolio will be composed entirely of mission-aligned investments that actively work in concert with our grantmaking efforts. We recognize that larger, systemic changes to the economy must occur before this can happen. We believe that our efforts to identify and support socially and environmentally responsible innovative investments will advance this goal.
Within this portfolio, Swift Foundation retains a five percent allocation of United Parcel Service (UPS) legacy stock, the proceeds from which created the foundation in 1999. The foundation continues to act as an active shareholder with UPS in honor of the family’s former ties with the company.
We encourage foundations to engage in mission investing beyond the five percent payout requirement. While PRIs can supplement grants and program costs in meeting the five percent, Swift believes mission investing is an essential philanthropic tool.
While a growing segment of our Core and Transitional assets meet the IRS qualifications for PRIs, we only classify some investments as PRIs. This reflects our experience that many PRIs are market rate with acceptable risk and performance objectives.
We believe that foundations should be generous grantmakers and impact investors.