From Grant Making To Mission Related Investments

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Jacqueline van Voorthuizen, CEO - Zyllian Strategies - Netherlands

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From Grant Making To Mission Related Investments

  1. 2. Challenges The Fortune at the Bottom of the Pyramid, C.K. Prahalad & Stuart L. Hart
  2. 3. <ul><li>“ If the entire world lived like North Americans, </li></ul><ul><li>it would take three planets earth </li></ul><ul><li>to support the present world population” </li></ul><ul><li>Harvard Business Review, 1997 Stuart Hart, “ Beyond Greening ” </li></ul>Constraints
  3. 4. Money is not a constraint... Source: Worldwatch Institute, State of the World 2004
  4. 5. <ul><li>“ The ultimate business opportunity ” </li></ul><ul><li>“ Win-win business models ” </li></ul><ul><li>“ Blending financial and social value ” </li></ul><ul><li>Bron: </li></ul><ul><li>Doing business with the poor, 2004 </li></ul><ul><li>World Business Council for Sustainable Development </li></ul>...business opportunity neither
  5. 6. So... what’s the problem? <ul><li>Who’s behind the wheel ? </li></ul>
  6. 7. Another way to look at it <ul><li>The market is an efficient, effective, and innovative instrument for sustainable development </li></ul>
  7. 8. Support <ul><li>“ There are many positive ways for business to make a difference in the lives of the poor – not through philanthropy, though that is also very important, but through initiatives that, over time, will help to build new markets .” </li></ul><ul><li>Kofi Annan, United Nations, Secretary General </li></ul>
  8. 9. How can we bridge the gap? EQUITY BONDS GRANTS ?
  9. 10. How to bridge the gap EQUITY (PRIVATE) BONDS CASH GRANTS SRI EQUITY BONDS SUSTAIN. PRIVATE EQUITY SOCIAL VENTURE CAPITAL VENTURE PHILAN- THROPY MICRO- FINANCE
  10. 11. Multiple bottom line portfolio construction (1) MISSION RELATED RETURN equity 8-12% real estate cash bonds 3% 6-8% private equity 15-20% gifts & grants -100% 4-5% FINANCIAL RETURN
  11. 12. Multiple bottom line portfolio construction (2) equity real estate cash bonds 3% 4-5% private equity -100% sustainable private equity social vc mf 15–20% 0-20% 2-5% 8-12% 6-8% 15-20% FINANCIAL RETURN SOCIAL AND ENVIRONMENTAL RETURN
  12. 13. Multiple bottom line portfolio construction (3) SOCIAL AND ENVIRONMENTAL RETURN FINANCIAL RETURN equity real estate cash bonds 3% private equity -100% sustainable private equity social vc mf 15-20% 0-20% 2-5% alternative or direct SRI public or indirect SRI 8-12% 4-5% 6-8% 15-20%
  13. 14. Social and environmental returns MISSION RELATED RETURN <ul><li>less child labor </li></ul><ul><li>clean water </li></ul><ul><li>clean energy </li></ul><ul><li>health care </li></ul><ul><li>education </li></ul><ul><li>poverty alleviation </li></ul><ul><li>sustainability </li></ul>comparable financial returns FINANCIAL RETURN
  14. 15. Tools <ul><li>A multiple risk return profile </li></ul><ul><li>A purpose budget </li></ul><ul><li>The millennium development goals </li></ul><ul><li>The disciplinary power of the financial market </li></ul>
  15. 16. The result

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