“Philanthropy or Investing: Why Not Both?”

“Philanthropy or Investing: Why Not Both?” by Ellen Remmer
is an excerpt From “Feminist Giving: Creating New Frontiers in Social Change”

After 25 years focused on both her own philanthropy and advising others,  Ellen Remmer became persuaded that philanthropy alone was not enough to make big societal changes.

“The deeper I got into impact investing, the more I was persuaded,” says Remmer.  “It connected me to my money in new and different ways, and it was so much more interesting personally. Moreover, I realized that many of the societal problems we want to solve are caused (in part) by problems in the capital markets and/or can only be solved through the capital markets. Think gender and racial equity, for one!”

Remmer is part of a minority of women in our culture who have pursued their interest in impact investing to the point of actually doing it. While more women are finally moving into impact investing today, Remmer wants to add to that momentum and make sure they are equipped with knowledge and guidance to not just do impact investing, but do it well.

A projected $400 billion or more will be directed to impact investments in 2020, a dramatic increase from $80 billion in 2011. But Remmer notes that there is a disconnect between women’s interest in the field and the actions they currently take with their investments.

Invest for Better launched as a project of TPI in early 2019 in collaboration with a coalition of national leaders from organizations like Mission Investor Exchange, Mission Throttle, and the Case Foundation. In 2021, Remmer spun it out as an independent nonprofit, with co-founder Janine Firpo, author of the acclaimed book Activate Your Money:  Invest to Grow Your Wealth and Build a Better World.

“We know that women are hungry to learn more about how to invest with their values,” Remmer says. “We help build their knowledge base and make it easy for them to activate their investments for impact.”

Getting Together with Other Women and Making It Happen

The primary way that Invest for Better gets women active is by offering them the opportunity to join or lead Invest for Better Circles, groups of 6-15 peers who meet either in person or virtually over a 6-month period, using a curriculum based on Janine’s book. As part of the experience, each woman establishes a “move your money goal” and commits to an action step. These action steps include things like, “I will talk to my partner about allocating some or all of our shared investments to impact”, or “I will better understand how my cash is invested and choose a bank that matches my values.” Others may be about finding a new financial advisor or making an angel investment. So far, over 800 women have been part of an Invest for Better Circle  “This is really about accelerating things,” says Remmer, “and getting women to understand that values-aligned and impact investing are possible and there are many ways to do it.”

One way Remmer sees impact investing having big potential is with Community Development Finance Institution (CDFI) investments.    “Not enough people know about the opportunity to invest in their own communities through CDFIs,” says Remmer, noting that CDFIs are generally a more secure investment than stocks, and pay a guaranteed return. “I just had coffee with this amazing woman, Catherine Berman, who has started an impact investing firm called C-Note which invests in CDFIs throughout the country.” The annual return on CDFIs through C-Note is 2.75% with no fees. Recently, the firm also launched The Wisdom Fund, which is specifically aimed at increasing capital access for women-owned businesses.

“If you start to change the face of the investing community so women are more deeply involved, you’re going to change the nature of what we’re investing in, and who we invest in,” says Remmer. She sees this happening both in philanthropy and in finance, and has been a frontrunner in both of those movements. She and her sisters and mother started a family foundation about 30 years ago, focusing on disadvantaged girls, an idea that was barely registering on the radar of philanthropy at the time.

While philanthropy directed exclusively to women and girls still only makes up a small fraction of philanthropy, it’s an area of philanthropy experiencing intense growth now, alongside capital investments directed at gender equality. Between the two, Remmer is on a mission to help remove limitations for women, and shift their understanding of the role they can play.

“I’ve been a philanthropic supporter of the work that Joy Anderson of Criterion Institute is doing, and it’s exciting to see so many people trying to get in on it now,” Remmer said. Ranked by Fast Company as one of the 100 Most Creative People in Business, Joy Anderson has been highly instrumental in laying the foundation for social impact investing, particularly for women.

Remmer also sees women doing creative things with their Donor Advised Funds, and was an early adopter of these techniques.  “I’ve got about four different deals through my DAF at the Boston Foundation,” she says. Remmer says some of these investments are in the form of recoverable grants and some take other forms, but the bottom line is that money that was formerly “just sitting there” is now activated for social and environmental impact.

Using Donor Advised Funds for Catalytic Strategies

“With my DAF, I’m willing to take higher risks,” says Remmer. “I’ve done a lot more local things with my DAFs. One is a social finance bond here in Massachusetts, and another supports the Boston Impact Initiative, which invests in a diverse and inclusive economy. I also have one with an energy breakthrough group called Prime.

Remmer referenced the expanding realm of vehicles that women can explore if they want to do more impact investing. “The bottom line is that women have to think more about the investing side of things across the board.” Doing so will likely lead to the kind of epiphany she had two decades ago when she started learning about impact investing with a gender lens.

“It used to be that we gave away 5% of our foundation, and we didn’t even think about the rest,” says Remmer, noting that now her family foundation is 100% invested for impact. That epiphany led her to develop a passion for the field, which is now converging with other cultural factors driving the growth of the approach, particularly for women. “The point is, I went through a personal journey with impact investing, and while philanthropy is fantastic, I wasn’t using the power of what I had in all of those other resources.”

Excerpt From:
“Feminist Giving: Creating New Frontiers in Social Change”
by Kiersten Marek.

This material may be protected by copyright.