Foundations diversify their investment managers
Foundations try to increase diversity, starting with the companies that manage their assets. The Nathan Cummings Foundation announced in a Press release This month black-owned asset management firm Bivium-WestFuller will now manage its endowment.
Separately, the MacArthur Foundation has pledged to invest at least 20% of its assets in businesses run by people of color and / or women by 2024, according to a report. declaration released last week.
As Senior Economic Correspondent Oscar Perry Abello reports, foundations account for over $ 1 trillion in invested assets in America, but are only required to spend 5% annually. The majority of their assets are invested in stocks, bonds and other investments. The returns are then used to fund foundation grants. Many critics have found this model to be harmful and at times disingenuous.
“A foundation that gives money to groups that advocate for criminal justice reform could also invest in private prisons. Another foundation funding scientific research into more efficient and affordable renewable energy technologies could also invest in fossil fuels. A tenant funding through a foundation that organizes on the grant side might also have investments in real estate where property managers regularly harass or evict tenants, ”writes Abello.
The lack of representation in wealth management is striking, like Abello reported in 2019. Of the $ 70 trillion managed by US-registered asset management companies, less than one percent is managed by businesses run by women or people of color. Various investment managers often put money into investments that white managers don’t, which can add balance to an investment portfolio, The Chronicle of Philanthropy reports. By having a more diverse management team, foundations also have the opportunity to build wealth among finance professionals who have encountered obstacles to success.
Beyond hiring more diverse asset managers, some private foundations have recognized the problematic model and have started to divest from projects that do not match their grant missions. The MacArthur Foundation, for example, is moving away from fossil fuels and investing in climate-friendly solutions.
Report shows low-wage workers disproportionately denied sick and family leave during pandemic
Access to paid sick leave varies with wages, with higher paid workers being significantly more likely to have paid sick leave. Access also varies across the country. Only 67% of workers in south-central states (Alabama, Mississippi, Kentucky and Tennessee) have paid sick leave, while 95% of workers in Pacific states (California, Oregon and Washington) have it.
The statistics on paid family leave are more striking. Only 23% of workers in the private sector had access to paid family leave. Even in the highest income category, only 37% of workers have access to paid family leave. Paid family leave is only available to around 12% of workers in the lowest wage category.
Paycheck Protection Program Changes Increased Loans for Underserved Businesses
About 42% of the loans made by the Small Business Administration (SBA) Paycheck Protection Program during Phase 1 went to “small businesses” that employ 10 to 499 workers, which is only 4 % of small businesses in America. To address this issue, Phase 2 admitted around 600 new lenders, including non-banks and community development finance institutions. Now a US Government Accountability Office (GAO) report notes that these changes have led to a significant change in the types of businesses that have received loans; By the time the paycheck protection program closed in June, small businesses with less than 10 employees had received more than 80% of P3 loans in phase 3, compared to just 9% in phase 1.
Our senior economic correspondent Oscar Perry Abello reported last year that Phases 1 and 2 of the PPP did not prioritize rural and underserved markets as noted. He found that states where community banks have a higher deposit market share also had the highest number of PPP loans relative to their population size. However, community banks have dramatically disappeared over the past 30 years. As large banks had less incentive to lend to small businesses, small business owners did not get the PPP loans that CARES legislation provided for them.
Even though loans to businesses with less than 10 employees surged in phase three, they remain disproportionately low compared to their representation in the overall small business community.