Mission-related investing – encouraging news from Germany

 

Michael Alberg-Seberich

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Michael Alberg-Seberich

The short story: Mission-related investing (MRI) has a much bigger potential than many foundation practitioners thought in the past. The other good news is that financial and legal experts have shown in a report that more MRI is possible by foundations in Germany.

The long story: This blog post takes us to Stuttgart in the south of Germany. Stuttgart is one of these places where change seems to happen in a natural way. The city just elected a mayor from the Green party, and a year ago the state of Baden-Württemberg elected a Green prime minister. A few years ago nobody would have thought that something like this would be possible. Stuttgart, which is also home to such global players as Daimler and Bosch, is also one of the centres of the German Mittelstand. These small and mid-sized companies are the backbone of Germany’s economy.

What does this have to do with giving and mission-related investing? Well, in places where entrepreneurship seems to be a natural habit, giving is one too. This is why, on the first Friday of November the Initiativkreis Stuttgarter Stiftungen e.V. (Network of Foundations in Stuttgart) met for its 13th annual gathering. During this meeting the BW-Bank offered a workshop on mission-related investing where the German Association of Foundations and the consultancy Impact in Motion presented their report Mission investing im Deutschen stiftungssektor (Mission investing in German foundations). Johanna Weber, founder of Impact in Motion, presented the findings of this survey. One message of the study is that MRI is possible – in fact, it is already done by some foundations and it attracts more strategic and financial interest by foundations. The study and the following panel discussion showed that the current legal framework in Germany allows for more such forms of investing by foundations. What is needed now is to spread this message, to start a dialogue with foundation supervisory authorities on MRI, to ask banks for more products in the field and maybe even to help build a market of intermediaries that can develop MRI products.

Although the study is in German you may still want to have a look at it. The authors did a fantastic job visualizing their findings, and some of the infographics in this report should show up in other reports on MRI and impact investing.

The whole event took place on the premises of one of these typical German Mittelstand companies. The discussion was engaged and serious, but among the present donors and foundation professionals MRI was seen as a natural and obvious thing to happen.

Michael Alberg-Seberich is managing partner at Active Philanthropy

Tagged in: Germany Impact investing Mission-related investing MRI


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