As many of you will know, we launched our new strategic framework during 2020. That framework sets out our priorities for this current five-year period and the principles which provide the “golden threads” through our grant-making. But equally importantly, it states “that we respect our legacy of prudent, yet visionary, stewardship…making imaginative and appropriate use of our endowment”.
Respecting our legacy of prudent, yet visionary, stewardship, we will ensure that we continue to develop this legacy…making imaginative and appropriate use of our endowment.Dunhill Medical Trust Strategic Framework 2020-25
A well-managed investment portfolio is what enables us to do what we do and achieving good financial returns underpins the ongoing viability of our “business model”. In common with many similar organisations, we have since our inception practised the traditional method of using the proceeds of our investments to support our mission. But maintaining the value of our endowment is not an end in itself. The question we had to ask ourselves was “are we doing this as imaginatively and effectively as we might?”
As our mission focuses on developing the evidence base around healthier older age, we felt strongly that we should be taking the wider social and environmental impact of our investments into account, and so we needed to make sure that our investment choices were given the same attention and prominence as our grant-making, with all of our board members contributing to the debate, not just those with investment expertise. The issues this raised, we found, were not at all straightforward and cannot be solved overnight. But we felt that they couldn’t be put on the “too difficult pile”. As the Association of Charitable Foundations says in its white paper: Investment: Pillars of Stronger Foundation Practice, our endowment is our ‘super-power’. The financial independence and longer time horizons we enjoy provide unique opportunities not available to the majority of private and public sector organisations, that, if seized, can help us to effect the changes we set out to achieve in our mission, and to withstand financial turbulence. The experiences of the last two years meant that it felt even more important and urgent that we start on our journey.
We weren’t starting from scratch. Our investment policy had already adopted the good practices of a “responsible investor”, one who believes it is in the long-term financial interests of the investor and the interest of society as a whole to ensure that the risks and opportunities associated with environmental, social and governance (ESG) issues are properly managed. But we felt we needed to go further. I’m therefore delighted to publish our Impact Investment Policy which sets out our aspirations at each of the points along The Spectrum of Capital: a framework devised by Bridges Fund Management and the Impact Management Project. This attempts to show that not only can investors avoid causing harm to people and the planet, but they can also be much more proactive and invest to make positive contributions to effecting change in our communities.
It’s early days. Our policy is intended to be a statement of our intent and our acknowledgement that this is the start of a journey on which we will learn and make adjustments along the way. It is not the ultimate destination. We hope that by publishing this policy, we will encourage others to share their experiences and demonstrate that we are open to collaborate on seizing important opportunities and addressing challenges which we don’t have the resources to tackle alone. I look forward to sharing the journey, the conversations we’ll have and the learning we will gain along the way.
Chief Executive Officer