Australia’s biggest philanthropic foundations are challenging asset managers to invest their endownments for positive social and environmental impact.

Six trusts and foundations are taking part in the Endowments for Impact Challenge run by Impacting Investing Australia, to “catalyse broader change in how the philanthropic sector invests”.

They are Besen Family Foundation, Dusseldorp Forum, Inner North Community Foundation, Northern Rivers Community Foundation, Oranges & Sardines Foundation and Reichstein Foundation.

Sydney cityscape at night by Mudassir Ali: Australia’s top ideas for endowment mission investment will be revealed in March 2025

The six have a combined investment pool exceeding Aus $170 million, which they say they want to be invested in line with their charitable goals and mission. 

Investing endowment inline with mission

A statement from Impact Investing Australia said the ‘pioneering initiative [is] set to reshape how philanthropic investments are managed in Australia’ and will ‘catalyse broader change in how the philanthropic sector invests’.

The challenge asks advisors to showcase the demand for “credible mission-driven investment advice among Australian philanthropic trusts and foundations; inspire innovative approaches to responsible mission-driven investment practice; and, promote collaboration and transparency within the investment strategies of trusts and foundations”.

David Hetherington, CEO of Impact Investing Australia, said: ‘The Endowments for Impact Challenge represents an exciting opportunity for investment advisors to demonstrate their expertise in responsible mission-driven investing. We are eager to see how participants will propose innovative strategies that not only meet financial goals but also advance the missions of these philanthropic organisations.’

Elevating investment advice for philanthropists

It is not uncommon for philanthropic endowments to be invested solely with the aim of generating the highest financial returns, regardless of what the money is invested in.

But there’s a growing interest from philanthropic foundations who want their endowment – the largest part of their capital – to be invested for social and environmental good.

‘This is an important initiative for the philanthropic sector in Australia,’ said Rachel Ball, CEO of Reichstein Foundation, which is taking part. ‘We are looking for partners who can support us to truly align our investment strategies with our values and objectives. The challenge aims to spark collaboration and elevate the standard of investment advice in the philanthropic community.’

After submitting their prosals next month, up to six finalists will be invited to present their ideas in Sydney in March 2025.  A report capturing key findings and recommendations will be published in 2025.