“We literally had a fire door between the investing division and program division,” said Doug Stamm, executive director of the Meyer Memorial Trust, today at the Council of Foundations conference. “You had to walk the equivalent of four bowling lanes and pass the fire door to get to the financial team.” Now, the CFO of the $650M foundation sits in the middle of the program staff.
What sparked life-time trustees, who once saw investments only in terms of financial returns, to embrace program-related investments?
“I was having lunch with one trustee,” Stamm said, “and he made a comment in passing. He’s approaching 80 and a good investor. He said, ‘This is a good job for you, but $650M is not as much as it used to be.’ I said, ‘That’s right, but it can make a big difference,’” Stamm recalled. “And it made us realize that five percent of $650M cannot solve deep seated problems. Five percent of a billion dollars may not solve deep seated problems.”
For shock value, a week after the expose of the Gates Foundation’s investments in environmentally harmful companies appeared in the L.A. Times, Stamm did a mock-up of the Oregonion newspaper cover with the headline “Dark Cloud Over Meyer Memorial Trust Investments,” and then put photos of the trustees in the story. Stamm showed the newspaper to a trustee, and that scared the trustee sufficiently to make the point.
Meyer Memorial currently invests 1.5 percent of their portfolio in PRI. And it has overcome other external challenges, such as coming to agreement with its outside money managers about what constitutes PRI. One outside manager said that investments in Toyota and Honda for fuel efficiency counted. One bond manager said that 100 percent of the bond portoflio counted as PRI since they were “supporting America and American people.” Meyer Memorial questioned both those opinions by their outside money managers.
We should aim for 1 -2 percent of the portfolio to be dedicated to PRIs, Stamm said. “And even then, we’re going to look back in 10 years and
say we were too modest. “
Perla Ni, founder and former publisher of Stanford Social Innovation Review, is the founder and CEO of GreatNonprofits. She is also a co-founder of Grassroots.com.