Fundholders at the Community Foundation can now direct their donations to an Environment, Social and Governance (ESG) investment fund. Community Foundation assets, topping $70 million, are managed by Mason Investment Advisory Services of Reston, Virginia, ranked by Barron’s as #13 in the nation in 2022.

The new investment option comes after a growing number of our fundholders have asked about an ESG option for the funds they have entrusted with us.

As attention to issues like climate change and business ethics grows, so does the level of investments in ESG-rated funds across the economy. In 2021, U.S. investors poured $649 billion into ESG-focused funds, up from $285 billion in 2019.

ESG funds are developed with a set of standards used by investors to screen potential investments based on a firm’s operating practices:

  • Environmental criteria consider how a company affects the environment and its policies towards issues like climate change.
  • Social criteria measure how a company interacts with employees, suppliers, customers and the communities in which it operates.
  • Governance criteria address a company’s leadership, executive pay, audits, internal controls and shareholder rights.

Investment portfolio managers can either include or exclude certain companies based on how a company performs on ESG criteria. For example, an investor may wish to include companies focused on clean and renewable energy, or those with certain human capital management practices, like strong gender or racial diversity programs.

Alternatively, an investor may wish to exclude companies that rate poorly on environmental criteria, like some energy companies, or firms with low ratings in employee management or with weak internal controls.

This ESG Fund option is an additional benefit of partnering with the Community Foundation, providing fundholders with another way to have their philanthropic dollars support their values.

For more information about our ESG Investment option, contact Steve Adams.

Caption: Gibbet Hill, Groton (Chuck Losey)