Impact Investing

What is Impact Investing?

Impact investing refers to investments made into companies, organizations, and funds with the intention of generating a measurable, beneficial social impact as well as a financial return. 

BCF’s Decision to Engage in Impact Investing

BCF is adding impact investing to our toolkit of grantmaking, initiatives, and advocacy because it will -

  • Align more of our capital with our mission 
  • Further our commitment to racial equity
  • Generate benefit to the community as well as financial returns 
  • Provide an opportunity for donors to Invest in Baltimore in a new way 

BCF’s Plan for Impact Investing

We propose to partner with community development financial institutions (CDFIs) to lend our money locally to projects that benefit the Baltimore community, particularly communities of color. We are developing a portfolio of such investments that align with our mission and core priorities. 

We aim to achieve a blended return of approximately 3.0%. We will ladder the terms of loans and notes, with a term length not to exceed 10 years. 

Initially we will move up to $4,000,000 from the fixed income asset class of the BCF Pool into the new Impact Pool. 

We will offer the Impact Pool as a third investment option for fundholders, joining the BCF Pool and the Money Market Pool. And we will invite anyone who cares about Baltimore to make a gift of any size to a fund fully invested in the Impact Pool. 

Timeline

September 2017
BCF Board of Trustees appointed members to an Impact Investment Subcommittee which will oversee the impact investment portfolio.  

October 2017
Subcommittee has first meeting

By December 31, 2017
First impact investments made from fixed income asset class of the BCF Pool.

2018 (tbd) 
Impact Pool added to investment pool selections for BCF fundholders.

General fund opened for contributions of any size for the Impact Pool. 

Quarterly BCF
will provide quarterly reports on the financial return of the Impact Pool. 

Annually
BCF will provide annual reports on the social return of the Impact Pool. 

Q&A

Will investment returns be affected?

There will be little or no effect on investment returns in the BCF Pool. BCF will commit up to 4% of assets in the BCF Pool to the new Impact Pool, and anticipates returns that are competitive with fixed income investments. Our financial goal for the Impact Pool is a blended return of 3%. 

What kind of social return does BCF expect to see? 

We will identify investments where the social return focuses on Baltimore City and County. Investments may include, for instance, small business lending, affordable housing, healthy food access, or education. Wherever possible, investments will be aligned with BCF’s priorities in neighborhoods and education. 

Who is choosing the investments?

The Impact Investing Subcommittee of the Investment Committee will explore impact investing options and make recommendations to the Investment Committee, which will make final decisions on investments. BCF staff and consultants will assist with performing due diligence on the investment opportunities. 

What kind of oversight will there be on the Impact Pool? 

BCF intends to invest in Community Development Financial Institution (CDFI)  intermediaries who have a strong track record of working with borrowers. Therefore, there will be two layers of oversight of the Impact Pool. Individual investments will receive oversight from the CDFI intermediaries who make the investments. BCF’s Investment Committee will regularly review performance data from those intermediaries. 

Who else is using impact investing, and what have the results been like? 

Impact investing is becoming common both for community foundations across the U.S. and for private foundations in Baltimore and elsewhere. According to the Global Impact Investing Network (GIIN), impact investments are growing rapidly and represented $114 billion in capital last year. Community Development Financial Institutions, BCF’s likely partners, have a successful 30-year history of doing this work—during that time, they have created more than one million jobs, more than 1.5 million housing units, and 192,000 businesses. In 2015, CDFIs provided at least $5 billion in capital to low income individuals and communities. Their financial results were on par with mainstream financial institutions. 

What is the role of the Subcommittee?

The Subcommittee will recommend and implement the Impact Investment Policy Statement, set asset allocation, select consultants, monitor the overall liquidity of the investments with respect to BCF’s needs and provide overall direction to the administrative staff in the execution of the investment policy.  The Subcommittee is responsible for evaluating and recommending impact investments to the Investment Committee.  The Investment Committee will be the decision-making body.

The Subcommittee shall include no fewer than five members appointed by the Committee on Trustees and Governance.

Impact Investing Subcommittee

Patricia P. Baum
RBC Wealth Management, Baum Jackson Investment Group
Patricia P. Baum

RBC Wealth Management, Baum Jackson Investment Group

Trustee since 2014

Committees: Investment (Chair); Executive; Retirement Plan (Co-Chair)

 

Patti has been a financial advisor and wealth manager with RBC Wealth Management since 1998. She began her career in 1985 as a Financial Advisor with Alex. Brown & Sons. Patti is part of RBC’s Private Wealth Group, a select group of advisors serving high net worth individuals and institutions. She is a member of the firm’s Senior Consulting Group, and has been consistently named to the firm’s Chairman’s Council, membership which is offered to the top 150 advisors. The Baum Jackson Investment Group was selected as one of Barron's Top Advisory Teams in 2010, 2011, 2012 and 2013. Patti was named to the Financial Times Top 400 Advisors in 2013, 2014, 2015, 2016 and 2017. In addition, Patti was named to the inaugural Top 100 Women Financial Advisors list in 2014. Patti earned a Bachelors Degree from Duke University in 1978, graduating summa cum laude, and earning membership to the Phi Beta Kappa honorary society. In 1991, she graduated from the Wharton School Securities Industry Institute program. In addition, she has completed the US SIF Foundation Course: Fundamentals of Sustainable and Responsible Investment from the Center for Sustainable Investment Education.

 


Oswaldo Acosta
Latino Economic Development Center
Oswaldo Acosta

As an entrepreneur, Oswaldo understands the value of having access to financial services first hand and is aware of the important role that the Latino Economic Development Center plays in the success of the region’s small business owners. In his own entrepreneurial ventures, he launched and expanded a food manufacturing company with market reach in Virginia, Maryland, DC, Pennsylvania and New York City. After his company’s acquisition, Oswaldo joined Self-Help Ventures Fund’s team, a non-profit Community Development Financial Institution (CDFI) where he was part of a commercial lending group prior to joining LEDC as director of Small Business Services. Oswaldo’s academic training as an economist, his experience as a consultant for The World Bank and certainly his experience as an entrepreneur suits him with a broad and technical understanding of the challenges facing LEDC clients. He holds a bachelor degree in economics from Monterrey Tec, an MA in Political Economy and an MSc in Economic Regulation from Essex University and the London School of Economics and Political Science, respectively.

 

Beth Bafford
Calvert Impact Capital
Beth Bafford

Beth Bafford is Vice President of Syndication and Strategy. She works on domestic and international transactions across impact sectors, including health, small business, environmental sustainability and community resiliency. Beth also leads Calvert Impact Capital's new Syndication Services and the local investing campaign Ours To Own. Prior to joining Calvert, Beth was a consultant at McKinsey & Company. She has also worked at the White House Office of Management and Budget, on the 2008 Obama for America campaign, and at UBS Financial Services. Beth received both her BA and MBA from Duke University. At Duke’s Fuqua School of Business she helped launch the CASE Initiative on Impact Investing (CASE i3).

Matthew D. Gallagher
Goldseker Foundation
Matthew D. Gallagher

Goldseker Foundation

Trustee since 2016
Committees: Advocacy (Chair); Executive; 2016 Strategic Planning Task Force; CMTA Advisory Board

 

Matthew D. Gallagher serves as the President and CEO of the Goldseker Foundation. Before joining the Foundation in 2013, Mr. Gallagher served as Chief of Staff to Maryland Governor Martin J. O’Malley and was responsible for managing the day-to-day activities of the executive branch of Maryland State government. Prior to his position in Maryland State government, Mr. Gallagher served as Director of CitiStat, Baltimore’s nationally recognized public sector accountability program. Mr. Gallagher has also served as Project Director for the Greater Baltimore Committee, as an assistant deputy mayor in Philadelphia Mayor Edward G. Rendell’s administration, and in educational programs for the Baltimore Symphony Orchestra. Mr. Gallagher was born and raised in Baltimore and holds degrees from La Salle University and the University of Pennsylvania. He has taught undergraduate and graduate courses in public policy and administration at the University of Baltimore and the University of Maryland Baltimore County, as well as lectured at Harvard University’s Kennedy School of Government and the University of Pennsylvania’s Fels Center of Government.

 

Darius Graham
Johns Hopkins Technology Ventures
Darius Graham
As Director of Student Ventures at Johns Hopkins University, Darius Graham leads entrepreneurship and innovation initiatives that help transform new technologies and novel ideas into viable ventures. Among these initiatives are FastForward U, a suite of resources and network of innovation hubs for student entrepreneurs, and the Social Innovation Lab, an accelerator for social ventures led by students or community members. 

A Global Shaper with the World Economic Forum, Darius has been recognized by Baltimore Business Journal as one of Baltimore’s 40 Under 40 and is a graduate of the Greater Baltimore Committee’s Leadership Program. He serves on the Baltimore Museum of Industry’s Board of Trustees and teaches graduate courses in social entrepreneurship at Goucher College. Darius is the author of the award-winning book, Being the Difference: True Stories of Ordinary People Doing Extraordinary Things to Change the World

Darius previously founded DC Social Innovation Project, a non-profit initiative that provided funding and pro bono assistance to help launch and grow innovative, grassroots community initiatives in Washington, DC. He is a former Social Entrepreneur-In-Residence at University of Maryland’s Robert H. Smith School of Business and has served as a mayorappointed commissioner on the District of Columbia Commission on National & Community Service. 

Darius began his career as an associate in the corporate restructuring group at the law firm Akin Gump Strauss Hauer & Feld LLP. He received a B.A. summa cum laude from Florida A&M University and a J.D. from the University of California, Berkeley - School of Law where he served as an editor of the California Law Review and as editor-in-chief of the Berkeley Journal of African-American Law & Policy.

Amy Perez Jackson
Brown Capital Management
Amy Perez Jackson
Amy Perez Jackson joined Brown Capital Management in 2017 as the Director of Marketing & Client Service. Prior to this, Amy was VP and sales manager at Campbell & Company, VP at Mercantile Alternative Investments (now PNC Investments) and marketing associate at Mayfair Capital Management. She earned a BA in business administration from the University of Miami.
K. Brigid Peterson
Brown Advisory
K. Brigid Peterson
Brigid Peterson is an Endowments and Foundations Advisor at Brown Advisory. She has extensive experience working with nonprofit organizations and foundations, as well as advising families on structuring their philanthropic legacy. As a member of the Sustainable Investing Development Team, she works with clients to develop a mission-aligned portfolio. Prior to joining Brown Advisory, Brigid practiced law for a number of years and was a member of the Wealth Advisory Group at Legg Mason Wood Walker, Inc. She is the past President of Paul’s Place Community Outreach Center and is a member of the Friends School of Baltimore Board of Trustees. She is a member of the Baltimore and Howard County Estate Planning Councils, the Partnership for Philanthropic Planning, and the Chesapeake Planned Giving Council. She received a JD from the University of Maryland School of Law in 2004 and a BA from Connecticut College in 2000.
Vernon Reid
T. Rowe Price (Ret.)
Vernon Reid
Vernon Reid is a retired investment professional with more than 40 years of outstanding service to the Baltimore Community. He is a Trustee and Director of the Enoch Pratt Free Library and a Board Member of the Baltimore Educational Scholarship Trust(BEST). Vernon was a Trustee of the T. Rowe Price Foundation, from 2004-2017, the charitable giving entity for the T. Rowe Price Group, Inc. He was employed with T. Rowe Price from 1999 to 2017 in Global Trading and from 1977 to 1987 in the Fixed Income Division. Prior to rejoining TRP in 1999, Vernon was principal partner of V.A. Reid and Associates. He attended the U.S. Naval Academy, holds a B.S. in business administration from Towson University and an M.B.A. with a concentration in finance from Indiana University.
Alex Riehm
Johns Hopkins Technology Ventures
Alex Riehm

Alex Riehm is the Director of the Social Innovation Lab at Johns Hopkins Technology Ventures. The Social Innovation Lab supports innovative non-profits, mission-driven companies and disruptive technologies that aim to create change and opportunity in Baltimore and beyond. Alex is also a founding member of the Development Innovation Ventures (DIV) team at the United States Agency for International Development (USAID). DIV is USAID's venture capital-inspired, tiered, evidence-based funding model which has supported over 180 awardees in the last 7 years. With DIV, he had the sincere pleasure of supporting the team's growth and development from 2010 to 2017. As a Portfolio Manager, he worked directly with 65+ DIV awardees and alumni as they pursued their diverse pathways to scale. Previous roles with the team include managing the selection process for new awardees. Prior to his time with USAID, Alex supported post-conflict community development programming and research in Northern Ireland. He holds a Masters in International Affairs from the George Washington University and is a proud adopted Baltimorean, University of Florida Gator, cook, and dog-walker.

James Wahls
Annie E. Casey Foundation
James Wahls
James Wahls is a senior investment analyst at the Annie E. Casey Foundation. Wahls works on the foundation’s social investments portfolio that comprises of mission-related and program-related investments. Previously, Wahls served as the impact investing manager at the W.K. Kellogg Foundation where he co-managed the foundation’s impact investments across various asset classes. Through both roles, Wahls has designed or led impact investments nationally to support access to capital for entrepreneurs, quality job creation, foreclosure prevention, education technology, school construction, and community economic development. Wahls holds a bachelor’s degree in history from the University of Michigan and received his juris doctor degree from the University of Michigan Law School. He is a member of the bars of Michigan and the District of Columbia.
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