Mission-Aligned Investing

New Report Shows Divesting Foundations Can Build Value Without Sacrificing Values

A new report issued by the Croatan Institute finds that philanthropic foundations that have divested from fossil fuels experienced positive impacts on their financial performance. Croatan surveyed all philanthropies that had signed the Divest-Invest pledge since 2014 for the report. Among 60 foundations who participated—half of which were first-year signatories that could reflect on five years of financial data—94 percent report that dropping the conventional carbon-intensive energy sector resulted in a “positive or neutral” impact on returns.

Since the launch of Divest Invest Philanthropy in 2014, more than 200 foundations and family offices have pledged to divest their assets, collectively worth $24 billion, from the largest oil-and-gas and coal companies listed on the Carbon Underground 200. Many of the philanthropies that have divested have also redirected their investments to renewable energy and climate solutions.

The report includes a case study analyzing the experience of the Rockefeller Brothers Fund as we have sought to align our endowment with our mission, in part by divesting from fossil fuels, a decision announced in September 2014. In the subsequent years, our investments have outperformed market benchmarks. Despite the potential risks associated with a loss of portfolio diversification, the RBF has found that divestment from fossil fuels contributes to less volatility in the portfolio over time.

Related Links:

Read the report: Divest Invest Philanthropy – Five Years After Launch (CroatanInstitute.org)
The Chronicle of Philanthropy: List of Major Donors Divesting From Fossil Fuels Swells to More Than 200 (10/29/19)