Why did RWJF make a renewed commitment to impact investing?
RWJF has a modest legacy portfolio of program-related investments, but the new capital commitment is the Foundation’s first formal effort to incorporate impact investing into the way we work. For decades, we’ve worked to change systems and policies in order to make the healthy choice the easier choice—especially for those facing the greatest obstacles to good health. We are now doubling down on deploying impact investments as a way to shift capital markets and crowd in more capital for health and racial equity from a range of co-investment partners. We know that impact investing plus grantmaking can be a powerful combination.
What are the key elements of your impact investment portfolio?
Our investment portfolio will include loans, equity investments, and guarantees in organizations and intermediaries working in areas of programmatic importance or in the community development finance system. These investments will align with our grantmaking and maintain a steady focus on advancing health equity. We won’t do project-level financing and instead will work through intermediaries, who are in the business of investing capital in communities.
How can impact investing foster systems change and why is this important?
RWJF has long believed that to truly move the needle on health and well-being, we must change the underlying systems and policies that affect the health of many people. Through impact investing, we can work with a range of investors to help “crowd in” capital for health and racial equity. We can do this by bearing risk or accepting terms that are not tolerable for other investors. However, we will make these decisions after weighing the financial and social impacts of a transaction, as preservation of capital is one objective of the Foundation.
What does success look like—in terms of both capital leveraged and new partners?
We expect that by 2025, the $200 million initial allocation will be leveraged threefold to fivefold, bringing $1 billion from other private and public-sector investors. We plan to invest alongside a range of commercial investors to crowd more capital into low-income communities and toward health equity. We also expect that we will evolve the way we work significantly as we get comfortable deploying investments alongside grants and better understand how we can use our resources to engage new partners. While the Foundation will treat these resources as investments and seek a return of and on our capital, we fully intend to take risk—including losing money—when the opportunity for social impact warrants it.
How much of the $200 million has already been invested?
As of January 2021, the Foundation has approved six investments (loans, guarantees and deposits) totaling $45 million.
These inaugural investments are outlined above.
We will share updates on our impact investment website landing page when more information is available about future investments. Generally, we have a 3-year timeframe for deployment.