Impact Investing Holds Untapped Potential For Foundations and Wealth Advisors, Reveals Foundation Source Survey

Private Foundations Express Strong Interest in Impact Investing but Need More Information

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Nov 07, 2019, 13:25 ET

FAIRFIELD, Conn., Nov. 7, 2019 /PRNewswire/ -- Foundation Source, the nation's largest provider of comprehensive support services for private foundations, today shares findings from a survey of its foundation clients on "impact investing," an investment strategy that creates social or environmental impact while also generating a financial return.

Top findings include:

View the full report of Foundation Source's impact investing survey here.

Foundations have a strong interest in impact investing. 88.2% said their foundations are at least "somewhat" interested in impact investing.

The majority of foundations have embraced it, but many have not. Although 48.9% said that none of their foundation's investment portfolio is currently allocated to impact investments, more than half (51.1%) have at least some percentage held as impact investments. Of those, 3.3% have 100% of their assets in impact investments.

They need more information. When asked why they might be uncertain about impact investing, 37.7% said they simply "don't know enough about it."

They think impact investing is less profitable. The majority of respondents (51.6%) either "strongly" or "somewhat" agree that "impact investing means settling for lower returns."

Few have discussed impact investing with their financial advisors. 74.4% said their foundation had not explored this topic with their financial advisor. And of those who have discussed it, 79.2% said they had raised the subject themselves.

The full survey report can be downloaded here.

"Given the potential of impact investments to further both financial and philanthropic objectives, it's not surprising that private foundations are interested in them," said Page Snow, chief philanthropic officer of Foundation Source. "However, our survey shows that foundations need and want more information before really diving in. This presents an excellent opportunity for financial advisors to provide education and dispel the myths that may be inhibiting foundations from achieving more impact with their investable assets."

About the Survey

Impact investing is a popular topic in financial and philanthropic circles. However, beyond anecdotal evidence attesting to interest by private foundations, little is known about how they are (or are not) putting impact investing into practice.

To address this dearth of information, Foundation Source surveyed its private foundation clients about their interest in and experience with impact investing.

The survey findings are based on the responses provided by 122 of Foundation Source's private non-operating foundation clients. The largest percentage of foundations in the sample (46%) have assets between $1-10 million; 25% have less than $1 million; 23% have $11-50 million; and 6% have more than $50 million.

About Foundation Source (www.foundationsource.com)

Foundation Source is the nation's largest provider of comprehensive support services for private foundations. Our complete outsourced solution includes foundation creation (as needed), administrative support, active compliance monitoring, philanthropic advisory, tax and legal expertise, and online foundation management tools.

Now in our second decade, Foundation Source provides its services to more than 1,600 family, corporate, and professionally staffed foundations, of all sizes, nationwide. We work in partnership with wealth management firms, law firms, accounting firms, and family offices as well as directly with individuals and families. Foundation Source is headquartered in Fairfield, Connecticut.

SOURCE Foundation Source