Impact investing focuses on generating positive, measurable social and environmental benefits alongside a financial return.
Victoria Foundation began impact investing by creating an impact investing strategy and portfolio in 2018. The initial goal was to move 5% of the Foundation’s Common Trust Fund into impact investments. In June2023, the Board approved an increase from 5% to up to 15% over the next three to five years. Revenue generated from the Common Trust Fund endowment pool, valued at $422 million as of March 31, 2024, is what allows the Foundation to consistently and steadily increase the impact of annual distributions and grants into the community. The Common Trust Fund comprises the majority of Victoria Foundation’s assets under administration. Other assets under administration are managed separately. Embracing this impact-focused approach to how we invest our endowment means Victoria Foundation can maximize how we utilize every financial resource we manage to address the health and wellbeing of our community.
“The Foundation invests in line with our values, and our investments are a catalyst for impact. As a community and as an organization, we are in a prime position to support great change. The greatest challenges of our time require capital to solve, and our endowment helps us actively address the wicked problems of today. In 2023, the Foundation distributed more than $27 million through 1,800+ grants,” states Jessica Doll, Victoria Foundation’s Associate Director of Impact.
“While we have a longstanding history of financially supporting the charitable sector with grant funding, we are looking for new ways to invest in social purpose organizations that help to grow social enterprise efforts in our region,” reflects Doll.
Investing in the capacity of social purpose organizations
Federal initiatives, like the Investment Readiness Program (IRP), help social enterprises enhance their capacity to participate in the social finance market. Funded by the Government of Canada, the IRP provides non-repayable capital to help develop enterprises to a point where they can attract investment and participate in Canada’s growing social finance sector. This program is part of a broader effort to build a more inclusive and sustainable economy by supporting innovative solutions to social challenges.
Ecologyst is a Victoria-based clothing factory and brand specializing in making legacy items from natural fibres. They received $50,000 in non-repayable funding from the IRP through Victoria Foundation. “It helped them move along their business life cycle so they could accept financial investment in their company to further their work,” shares Doll. “We directed $1.2 million to 45
social purpose organizations across Vancouver Island through the program.” Ecologyst used the funds to hire consulting and legal support, which enabled them to close a very successful financing round in early summer 2023. Gauthier says, “The people at Victoria Foundation were very helpful and responsive. We are very happy with the results.”
Born from the desire to “draw down carbon across our supply chain and bring apparel manufacturing back to North America,” Gauthier describes Ecologyst’s current transition to supporting larger brands. “We make things differently than most, with way less harm to the planet and people. But we want to expedite the change needed in our industry. We are realizing the value of our most important asset, supply chain, and our ability to make clothing in North America. We have been working to transition the business to offer what we do to other brands. It’s the next step.”
My experience with Thrive Impact Fund (TIF) was
unlike any other I have had with a lender. It was a
very human experience. Their hearts are in the
right place. It was perfect timing and certainly
helped us to get where we are now.
— René Gauthier, Ecologyst
Recent updates of impact investing portfolio
In February 2023, the Victoria Foundation made an initial investment in TIF of $200,000. As TIF grows, the Foundation is anticipating to increase its investment Ecologyst also received financing through Thrive Impact Fund (TIF). TIF is a Canadian, place-based impact investment fund designed to provide flexible financing solutions to social purpose organizations in British Columbia working to drive systemic social and environmental change. Managed by Scale Collaborative in Victoria and launched in 2020, TIF targets investments that offer financial returns and contribute to positive outcomes in housing, food security, environmental sustainability, and Indigenous-led solutions to create a resilient and inclusive economy.
Impact investments have already shown a lot of promise and enable the Foundation to start generating impact from our investments in addition to our grants. With the significant success of impact investing, we can accelerate community impact by using investments as tools for social change.
For more detailed information, you can read Responsible Investing 2023: Victoria Foundation’s Approach at victoriafoundation.bc.ca/publications.