Calvert Foundation

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Community investing that is affordable and impactful

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Many people view investing solely as the hustle and bustle of Wall Street at peak frenzy. Or, perhaps as the result of a ribbon-cutting ceremony in which someone who donated an unfathomable amount of money gleefully smiles in front of a building bearing his or her name. Investing, at its extremes, is those things—but Calvert Foundation m operates on a different model. It aims to channel investment dollars to organizations addressing real needs in low- and middle-income areas.

Calvert Foundation began when the founders of Calvert Investments, a pioneering socially responsible mutual fund company, decided to see if they could find a way to funnel more capital into low-income areas across the US and around the world, and joined with the Ford, MacArthur, and Mott Foundations to make it happen, says Calvert Foundation vice president of investment partnerships, Justin Conway.

As Conway recalls, “From day one, it was, ‘How can we create a financial institution that has a real social justice mission and is able to get this capital to work in communities?’”

So in 1995, they set up Calvert Foundation as a nonprofit investment firm to help bridge the gap between those who want their money to be a part of something good and the organizations doing the good.

Calvert Foundation is a certified community development financial institution (CDFI), which aims to use its investments to economically lift up low- and middle-income areas through community investing.

Community investing is a socially responsible investing strategy that puts investor dollars into building up areas that are often underserved by traditional banks. Community investing dollars may provide fair loans for low-income people to buy a home, start a business, or obtain a college education, enabling them to lift themselves up economically.

Since 1995, over 15,000 investors have invested over $1 billion into Calvert Foundation to support hundreds of sustainable-development nonprofits and social enterprises on the ground in 60 countries and throughout the US. Calvert Foundation disperses the money as loans to advance local solutions to critical challenges in their communities.

The Foundation’s flagship investment vehicle is the Community Investment Note, and its key benefit is that it makes community investing easy: People may invest in the Note for as little as $20 online and through their brokerage accounts.

Investors may choose the cause they want to support— from women’s empowerment to affordable housing—as well as a number of domestic and international places. They can choose their investment term (from 1-10 years) and how much interest their Note will earn (from 0-3 percent). Since the foundation’s inception, over 13,000 people have invested in the Notes.

“It’s one of the ways where individuals with as little as 20 dollars and institutions that are investing tens of millions of dollars can, through our risk-mitigated structure, have a high impact in low-income communities,” says Conway.

For example, investments in the Note supported a loan to IFF, a Midwestern CDFI, which then assisted Beyond Housing, a nonprofit working to build affordable housing, strengthen health and human services, and build community engagement in Pagedale, MO, a low-wealth community of color near St. Louis. Overseas, Note investors helped Healthpoint Services, a sustainable social business enterprise in India’s Punjab region, provide low-cost clean water, wireless Internet access, and health care to those in poverty.

Conway says that the Foundation lowers investor risk by investing in a diverse pool of carefully vetted community development institutions and having layers of reserves to protect against losses. To date, Calvert Foundation boasts a 100 percent repayment rate to Note investors.

The Foundation has created a number of investing opportunities, including its Ours to Own program and its Women Investing in Women Initiative (WIN-WIN).

Launched in 2014, Ours to Own allows investors to support unmet needs in cities they care about, including Denver and Minneapolis, with more cities to be added in the future.

Says Conway, “We wanted to provide a vehicle for people in larger cities in the US to support local organizations and projects there … and that’s been a real success.”

In 2012, Calvert Foundation started the WIN-WIN program to help people invest in and support organizations and projects in the US and internationally that empower women and girls, says Conway. Investments into WIN-WIN have already been instrumental in building a new center for Girls Inc. in downtown Oakland, for example.

Conway, whose first job out of college was with Green America’s Community Investing program, says that investors can rest assured that their money has a positive impact when invested through Calvert Foundation: “I get to work directly with investors and financial advisors, and I get to see the money move.”

And, he says, it moves from vastly different sources, because the Notes’ low minimum investment means that people from a variety of financial backgrounds, as well as organizations and nonprofits that want to support great causes, can get involved.

“Whether it’s a foundation trying to figure out how to do its first program-related investments, or an individual who says, ‘Hey, I’m thinking about how my dollars can have more purpose,’ Calvert Foundation is [a powerful] way to do it,” he says.

—André Floyd