Unit #6 Flashcards
(19 cards)
Traditionally, what are the three sectors?
Business, government, and nonprofit
What is the second largest source of revenue for the nonprofit sector?
Government grants and contracts
Philanthropy can be defined as what?
Using private resources for public purposes.
What is embedded giving?
Where a gift is built into a purchase.
What are SRIs and what are they typically invested in?
Socially, responsible, investments. They are traditionally invested in publicly traded securities.
What is ESG criteria?
Environment, society, and governance and how they are governed. For example, are there women on the board?
What is mission-related investment?
A foundation or other entity consciously aligns its investment portfolio with its mission.
What are PRIs?
Program-related investments. If IRS rules are followed, nonprofits can use PRIs to make high-risk, low-return investments in for-profits or nonprofits.
What are SIBs.
The are socially impact bonds. They aren’t actual bonds but an arrangement in which nonprofits are paid for their success?
T or F: social entrepreneurs can work in for-profits or nonprofits?
True
What is a social venture?
Generally a for-profit making organization that seks to have more than one bottom line.
What is a L3C?
(Low-profit Limited Liability Company) A new business form created under state law specifically to qualify under IRS rules as a PRI. The form is meant to give comfort for foundations who seek to invest in a PRI.
Legally structured as a limited liability company (LLC), which offers operational flexibility and limited liability protection.
What is GIIRS?
“GIIRS (which stands for the Global Impact Investing Ratings System)
is a comprehensive and transparent system for assessing the social
and environmental impact of companies and funds with a ratings and
analytics approach analogous to Morningstar investment rankings
and Capital IQ financial analytics. It seeks to spark the impact
investment movement by providing a tool that is intended to change
investor behavior and unlock the potential of this new asset class.”
What is IRIS?
- “IRIS is the catalogue of generally accepted performance metrics that
leading impact investors use to measure the social, environmental,
and financial performance of their investments.”
What is SASB?
SASB stands for the Sustainability Accounting Standards Board. It is an independent, non-profit organization that develops industry-specific standards to guide the disclosure of financially material sustainability information by companies to their investors.
Purpose: SASB standards help businesses identify, manage, and communicate sustainability risks and opportunities that are most likely to affect their financial performance.
Industry-Specific Standards: SASB has developed standards for 77 industries, recognizing that sustainability issues vary significantly across sectors.
What is a B corp?
- A B Corp. is a for‐benefit company.
- It is designed and governed to have a double bottom line, both profit
and social benefit. - More than “PR,” the double obligation is built into the governing
documents. - The company cannot later treat social impact or humane employee
policies as “nice to have.” - B Lab bestows B Corp. Certification.
What is NatureVest?
NatureVest is the conservation investing unit of The Nature Conservancy (TNC), a global environmental nonprofit organization. It was launched in 2014 with the goal of unlocking private capital to support large-scale conservation efforts while also generating financial returns.
Purpose of NatureVest:
NatureVest bridges the gap between mainstream finance and conservation by structuring and sourcing investment opportunities that deliver both conservation outcomes and market-based returns. It works to attract institutional and impact investors into the conservation finance space.
What is Concessionary capital
Concessionary capital is a form of investment where the investor is willing to accept lower financial returns—sometimes below-market rates—in exchange for achieving social, environmental, or developmental impact.
Catalytic Role: It can help de-risk or attract commercial capital to projects that would otherwise be considered too risky or unviable financially.
T or F? PRIs can count toward a foundation’s annual distribution requirement (usually 5% of its assets), just like grants.
True
