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PWRDF diversifies finances by investing in social enterprises

PWRDF has invested some reserve funds with Vancity Investment Bank, Raven Indigenous Capital Fund and Oiko Credit.

June 8, 2020

By Mike Ziemerink

PWRDF is seeking more than just financial returns on investments, we’re also looking for social returns.

PWRDF invests a portion of our reserve funds to provide organizational security and to support our cyclical needs. This year, our Board of Directors investment committee decided to rebalance our portfolio by moving $800,000 into social enterprise investments with the goal of creating social change while earning interest.

PWRDF has placed $400,000 into “socially responsible investing” with Vancity Community Investment Bank, the national arm of Vancity Credit Union. VCIB is a values-based financial cooperative that seeks to redefine wealth beyond financial well-being, to include social and environmental well-being of members. PWRDF’s VCIB investments will only be in companies that improve our communities and our environment. It does not invest in industries that could be harmful to people or the environment, such as tobacco or weapons or natural resource extraction.

VCIB selects companies to invest in based on:

  • environmental performance
  • social responsibility
  • good corporate governance

“That is the heart and soul of VCIB,” says Lars Boggild, Investment Product Manager at VCIB. “We have inherited these long-standing values from Vancity Credit Union.” The Vancouver-based credit union has been around for 75 years and was the first institution to allow women to bank without a co-signer. In 2007, it became the first bank to become carbon neutral. “VCIB’s work is a continuation and even an amplification of that. All of our financing is to groups working in areas such as affordable housing.”

VCIB’s connection to PWRDF began with its “deep stand around truth and reconciliation, as well as Indigenous economic reconciliation,” says Boggild. “Those out west have been doing a lot of very active work in First Nations communities at the band council level in community development. We look for opportunities to lend to businesses or organizations that have enable Indigenous ownership or control.”

The PWRDF Board learned of Vancity’s Impact GIC, a bank term deposit product that contributes exclusively to community development lending, and sought to learn more. They met with members of the VCIB team, who explained several aspects of the product that appealed to the PWRDF Board. “VCIB is a schedule one bank. So first off, there’s credibility in that,” says Dan Waterston, Board Treasurer of PWRDF. “Banking is a heavily regulated industry, and it gave us confidence to know that VCIB was a reputable financial institution.”

PWRDF’s funds will be invested in Impact GICs for one year with the anticipation of rolling over and renewing. “The Impact GIC provides principal protection and a financial return. The funds that are placed as shorter-term investments are used as part of our capital base to enable our lending, and are returned to the investor at their maturity,” says Boggild.

The Board was also attracted to the GIC for its structure as a fixed income product. “Public markets have taught us a lesson,” says Waterston. “They go up and down. As a responsible investor, you should have a portion of your portfolio that’s not equity. VCIB’s GIC is a great fixed income product that combines strong social impact with a competitive financial return.”

VICB has also featured PWRDF’s new investment strategy in a promotional mailer to other faith-based agencies.

The investment committee has also moved $250,000 to Raven Indigenous Capital Partners, an Indigenous-led investment firm. Raven uses Indigenous knowledge to make unique investments that provide social change while also earning income.

Raven supports Indigenous entrepreneurs in getting access to capital and provides technical assistance to help Indigenous businesses succeed. 

PWRDF has invested $150,000 in Oikocredit, upon whose board PWRDF staff have held seats in the past. Oikocredit focuses its investments on financial inclusion, agriculture and renewable energy. By financing and investing in microfinance institutions and small business in developing countries, Oikocredit creates positive social impact all while making money for its investors.

PWRDF is proud to share a common vision with Vancity, Raven Indigenous Capital Partners and Oikocredit. By placing our investments in these social enterprises PWRDF is showing that we are working towards our vision of a truly just, healthy and peaceful world, even when it comes to our investments.

“We want our investments to be more socially and ethically purposed,” said Will Postma, Executive Director of PWRDF, “that way we can encourage our constituency that we are making good use of our investments and preparing for the future.”