Mission-driven investing: are foundations doing enough?

Colin Habberton

Foundations could take the lead in making mission-driven investing a mainstream practice. The pandemic may give them a push in that direction

For reasons that are both systemic and paradigmatic, mission-driven investing in South Africa is in its infancy with little evidence of the practice across the $3 billion of local foundations’ assets under management. Foundation decision-makers are influenced by an investment value chain only recently warming to the purpose and practice of impact investing. Similarly, trustees are just starting to shake off traditional approaches to the allocation of their assets.

However, the Covid-19 crisis has motivated South African foundations to respond with urgent adaptation. Mandates have been revised to support initiatives set up by government and civil society, largely reinforcing the work of their existing grantees delivering services to those in need. The challenge foundations face is whether they have the choice to ignore new approaches to the way they invest their assets to meet their current commitments, rebuild their balance sheets and fund the future of their mission.

The current state of mission-driven investing

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