Responsible investing for doing good
Rotarians frequently ask if The Rotary Foundation practices socially responsible investing by screening or restricting certain investments based on social, environmental, or political criteria. The answer is yes — and no.
Yes, the Foundation considers both financial and social returns when making an investment decision. Our Investment Committee encourages our investment consultant and its managers to invest in companies that comply with laws, regulations, ethical standards, and national or international norms and are aligned with Rotary values.
We also consider how each of our investment managers incorporates socially responsible investing as part of their process. Currently seven of these managers, responsible for about 36 per cent of the Foundation’s total assets, were signatories to the United Nations Principles for Responsible Investment. These principles offer possible actions for incorporating environmental, social, and governance issues — such as climate change, public and workplace safety, and shareholder rights — into investment practice. Following these principles could reduce risk, improve returns, and better align our portfolio with our mission.
Does this mean the Foundation will categorically exclude specific companies or industries from investment? That’s where the “no” part of my answer comes in. Given Rotary’s diverse membership and its various cultural beliefs, agreeing on such restrictions would be extremely difficult.
The Trustees of The Rotary Foundation and the Rotarian financial experts on our Investment Committee take their job very seriously. Rotarians have entrusted us with millions of dollars that they have designated to do good in the world. Our capacity to provide clean water and education, improve health care and economic development, and promote peace depends heavily on our investment income. So it is especially important that we invest your gifts wisely.
Because The Rotary Foundation belongs to all of us, we believe strongly in transparency. To that end, we have posted a wealth of information on www.rotary.org. You can find audited statements of the Foundation for the past three years and tax returns for the past six years, along with extensive material on investment practices, philosophy, and historical returns. I hope this detailed information will reinforce your confidence in our Foundation and inspire your continued generosity.
Foundation Trustee Chair