Investing in ETFs and mutual funds to help the environment

Since Patagonia founder Yvon Chouinard and Blue Ribbon Flies founder Craig Mathews started 1% for the Planet in 2002, the organization has certified more than $350 million in donations from committed companies to nonprofits working to protect the environment and combat climate change. But as it hits its 20th anniversary, CEO Kate Williams wasn’t interested in resting on laurels.

“We’ve done really well with our existing model, with strong record growth in membership over the last two years, so it would be very easy to say, ‘Cool, we’ve got the model, the flywheel is turning, and just keep keepin’ on,’” says Williams. “But that’s not enough, and it’s not how we want to roll and show up for the planet.”

Now the organization is expanding its ability to raise more funding by launching a new philanthropic investment fund that will both invest in companies working to fight climate change and grant more money to nonprofits.

The Planet Impact Fund is being created with partners CapShift and National Philanthropic Trust, and will launch with a portfolio of public investments selected to drive climate impact. The public allocation will include mutual funds and exchange-traded funds and will target best-in-class managers investing in climate leaders and solutions. The private allocation will focus on high-impact, nonpublic investment opportunities that can drive meaningful climate mitigation and support climate change resiliency. It will annually disburse approximately 10% of all funds to vetted environmental nonprofits.

Williams says that the idea for the impact fund came as they reflected on the group’s work over the past two decades, and wanted to find a way to dramatically boost its impact. “This fund tool enables us to tap the power of philanthropy to drive the additional power of impact investing,” says Williams. “Both members and nonmembers can donate, so there’s a real opportunity here to significantly expand and accelerate our goals by adding exponential growth to our incremental growth model.”

National Philanthropic Trust is the largest national, independent public charity that manages donor-advised funds, and is the Planet Impact Fund’s sponsor and fiduciary. CapShift is providing investment advisory services to the fund, through its expertise in impact investing, while 1% for the Planet is vetting the organizations that will benefit from the fund.

1% for the Planet is in the process of creating a portfolio of nonprofits that represent a variety of ways to fight climate change and protect the planet. Williams says the fund will be clear on where the money is being invested, and the groups benefiting from the 10% in annual grants. “This makes it super simple for donors, seeing these investments organized by CapShift, an expert in the field, and amazing annual donations to nonprofits identified by us, so they can clearly see their dollars doing amazing things.”

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