Often the best place for a health system to begin the process of building a place-based investment program is by assessing its current asset allocation and investment choices. Diving into the specific investments of the existing portfolio can be very enlightening. This process of inquiry can catalyze and strengthen a culture for place-based investment; if there is already internal buy-in, an abbreviated portfolio review may be sufficient.
Reviewing the contents of your portfolio with an eye for place-based investment is a critical step toward understanding your proximity to your community impact goals. It may be helpful to work with an investment advisor or service provider with robust sustainable and community investment experience and capacities, taking a detailed look across asset classes to identify:
- Current investments that create or reinforce the health problems that your institution is working to solve
- Place-based investments already present in your portfolio
- Opportunities to work with current investment managers to shift allocations or create new products that meet your place-based investment needs
The exercise of scrutinizing your portfolio against your place-based investment goals fosters a culture of community impact and sustainability within your investment office and the institution more broadly.
- What are the values and goals of your institution?
- How can investments support your institution’s health promotion objectives?
- Are you currently invested in companies or financial instruments that create or reinforce health problems that your institution is working to address?
- Who can support and/or build momentum for place-based investment internally?
- What is in the existing portfolio?
- Has the portfolio been inventoried to identify investments at cross-purposes with the mission of your institution?
- Has the portfolio been inventoried to identify existing place-based investments?
- Are there investment managers in your portfolio who can help you reallocate to place-based investments or establish new place-based investment products?
- What is the asset allocation and how can it be adjusted to incorporate a place-based investment carve-out?
- What is the desired annual rate of return for unrestricted assets?
Banking and Cash Management
- Does your institution have relationships with local community banks or credit unions?
- What opportunities exist for shifting deposits to additional local community banks and credit unions?
Oversight and Investment Management
- What are your investment advisors’ capabilities around sustainable, responsible, and impact investing?
- To what extent is your investment staff educated and experienced in sustainable, responsible, and impact investing?
- What are the capacities and offerings of your existing investment managers around place-based investing?
- What is the role of governance in setting or evaluating investment priorities or goals?
- To what extent is your board educated on place-based investing?
- Is there a dedicated place-based investment committee?
Policy and Governance
- What is the primary role of the investment portfolio in supporting health system operations?
- Are there Environmental, Social, and Governance (ESG) criteria for the portfolio?
- Does the institution have policy for sustainable, responsible, or impact investing?
- Do the institution’s policies permit place-based investment allocations?