How is my donation saved or invested?

With the Future Fund donors achieve a double impact:

1. Charities are supported through interest on investments
2. The investments themselves are done into people and/or business that bring a social and/or environmental benefit.

Moreover, as a donor, you can choose which impact you want to make! You choose both the charities that are supported with your donation and the sectors into which the investments are made!

For the investment sectors, there are 4 options to choose from:

1. saving
2. ‘responsible’ stock market investments
3. green stock market investments
4. supporting entrepreneurs in developing countries through microfinance

Here below, we describe these 4 options in more detail. All 3 investment options are funds of the Triodos Bank. We have chosen Triodos because it is a sustainable and social bank, ranked as the #1 ethical bank by Ethical Consumer in 2020.

1. saving

The donations of donors who choose the ‘savings’ option are held in a long-term savings account at our bank.

2. ‘responsible’ investments

What is ‘responsible investing’?

All investments at the Future Fund are done in accordance with ‘responsible’ investment values. Responsible investing means that ethical, sustainable and social standards are taken into account in the investments.

In practise, we do this by opting for an ESG or SRI fund. ESG stands for Environmental, Social, and Governance (ESG) and SRI stands for Socially Responsible Investment (SRI). In these funds, companies in certain sectors are excluded (such as weapons, tobacco and gambling), plus more weight is allocated to companies that perform better on ESG or SRI scores.

The average interest per year on stocks in general was 6.9% in the past century (already corrected for inflation). ESG and SRI investments generate the same (or even better) return as stocks in general.

Triodos responsible investments fund

If you have chosen the ‘responsible investments’ option, your donation will be invested in the Triodos Pioneer Impact Fund. Triodos itself describes this fund as follows:

Triodos Pioneer Impact Fund aims to generate positive impact and competitive financial returns from a concentrated portfolio of small- and mid-cap companies pioneering the transition to a sustainable society. We select companies for their contribution to our seven sustainable transition themes. Through integrated financial and sustainability analysis we identify the drivers of a company’s long-term value creation and assess the impact of ESG materiality on these drivers. Additionally, the companies we invest in must comply with the Triodos minimum standards.

3. green investments

What is ‘green investing’?

Green investments are investments in stocks of companies that perform specifically well on sustainability standards.

In practise, we do this by opting for an investment fund that follows a certain index, like the MSCI Global Environment Index, the MSCI World Climate Change Index or the MSCI ACWI Low Carbon Target Index.

The average interest per year on stocks in general was 6.9% in the past century (already corrected for inflation). Green investments have the same or an even better interest as stocks in general (see the links to the three MSCI indices in the previous paragraph).

Triodos green investment fund

If you have chosen the ‘green investments’ option, your donation will be invested in the Triodos Energy Transition Europe Fund. Triodos itself describes this fund as follows:

Climate change in many ways is the overarching challenge the world faces today. Triodos Energy Transition Europe Fund aims to mitigate the effects of climate change by increasing the share of clean energy in the total energy mix and by reducing CO2 emissions. The fund invests in wind farms, solar photovoltaic and solar thermal installations across Europe. Typically, these installations are privately owned and/or operated by a special-purpose vehicle.

4. supporting entrepreneurs in developing countries through microfinance

What is microfinance?

Microfinance is a form of financing that provides loans and other banking services to individuals and small businesses who lack access to conventional banking and related services, usually in developing countries. So this form of investment is simultaneously a form of development aid.

The average interest per year on microfinance funds is commonly between 2 and 2.5% (already corrected for inflation).

Triodos microfinance fund

If you have chosen the ‘microfinance’ option, your donation will be invested in the Triodos Fair Share Fund. Triodos itself describes this fund as follows:

Triodos Fair Share Fund offers investors the opportunity to make a pro-active, measurable and sustainable contribution to the development of an inclusive financial sector, thus contributing to bolstering local economies and stimulating entrepreneurship. The fund contributes to building a robust, transparent and inclusive financial sector, providing both debt and equity to financial institutions that demonstrate a sustainable approach toward providing financial services to the unbanked, including small and medium-sized enterprises. The fund increasingly focuses on institutions that stimulate the use of renewable energy by means of their financial services, or promote sustainable agriculture by offering special financial services.