The following preface was written by RSF President & CEO Don Shaffer for the Democracy Collaborative’s recent report, A New Anchor Mission for a New Century: Community Foundations Deploying All Resources to Build Community Wealth. The report highlights “The Innovative 30? community foundations and their cutting edge work focused on deploying resources, in many cases not just grants, in support of rebuilding community wealth. RSF is particularly excited about this report as it ties in well with the ongoing work we are doing with pioneering community foundation leaders who are determined to align their individual foundations’ investments with their deep commitment to place.
Many thanks to The Democracy Collaborative for this insightful paper. As so many of us push for innovation, it’s important we pause today to celebrate–as this paper does–the wide range of benefits that community foundations already generate.
Of many great quotes in the paper, one by Janet Topolsky from Aspen Institute Community Strategies Group brilliantly sums up the challenge: “A community foundation can do anything… But it has to decide what it wants to do.”
On the one hand, community foundations are nonprofit public charities with flexibility in their legal structures to create direct loan funds, loan guarantee pools, collaborations with community development financial institutions, and many other new approaches to working with different kinds of capital to meet the needs of local social enterprises. On the other hand, community foundations face many barriers in trying something new.
Yet, as this report shows, exciting innovation is already underway by community foundations, in both economic development and impact investing. Both are ways of moving toward the vital new anchor mission of deploying all resources to build community wealth.
The anchor institution work that The Democracy Collaborative has pioneered is a no-brainer for community foundations to embrace. Yes, it is resource-intensive and requires skillful partnering. But what is the alternative? It is a challenge community foundations will be wise to embrace.
Regarding impact investing, a massive cultural shift is still needed. There are very few foundation leaders who can say, as Clara Miller from the Heron Foundation does, “Our fundamental question for deployment of all capital will be, ‘what is the highest and best use of this asset for furthering our mission?'”
Short-term paper gains in a portfolio of public companies are just that–paper gains. They do not represent real wealth. The aspirational investment goal for community foundations is deploying 100 percent of assets for impact in their local communities. As this paper reports, Kelly Ryan and her board at Incourage Community Foundation in central Wisconsin are the first among community foundations to make this commitment. It will be exciting to watch as they move toward realizing this ambitious goal. At RSF Social Finance, our vision is of 100 community foundations reaching the 100 percent goal in the next decade.
I send my best to all of you taking on these worthy challenges.
President & CEO, RSF Social Finance
Click here to read the full report.