Nina Rijnders: Impact investing for philanthropic funds
This column was originally written in Dutch. This is an English translation.
By Nina Rijnders, Investor Relations at NLC Health Ventures
A recent change in the implementation of the ANBI regulations has made it easier for philanthropic funds to invest in impact funds. This offers new opportunities.
This change enables foundations to invest not only with their core capital, but also with the return on their assets, provided that these investments are in line with the foundation's objectives. In this way, foundations can contribute to their social objectives in a scalable and financially sustainable manner through impact investments.
Simplification and accessibility
Previously, making such investments required individual agreements with tax authorities, a process that discouraged many smaller funds.
FIN, the trade association of funds and foundations, together with its members, was a driving force behind this change. 'The simplification of the implementation regulation has created an additional instrument for funds to make an impact on their assets with income. This was previously possible, but only through an individual agreement with the tax authorities (a ruling), which smaller funds usually did not do. Now there is a level playing field for all foundations and more money will become available for impact investments, something that is in high demand,' says Siep Wijsenbeek, Director at FIN.
Case study: The Mr. Roelse Fund
An example of how philantropic funds can take advantage of these new regulations is the mr. Roelsefonds, which recently invested € 1 million in the NLC Health Impact Fund. This fund focuses on early-stage health innovations, with the aim of bringing new treatments and technologies to the market. The investment by the Mr. Roelsefonds illustrates the practical application of the new rules and serves as a model for how other foundations can participate in impact investments.
The director of the Mr. Roelsefonds, Tessa van der Valk, indicates that the decision to invest in an impact fund stems from the desire to make a more sustainable impact with the foundation's assets. 'Our goal has always been to improve the quality of care in our region. Investing in an impact fund, such as the NLC Health Impact Fund, gives us the opportunity to simultaneously achieve financial returns and contribute to more effective care, and thus to the feasibility of the social challenge we face.'
Impact and financial return: a symbiotic relationship
The investment is an example of how impact and financial return can go together.
'We believe that investments that are both sustainable and impactful deliver positive results for society. By collaborating with specialized funds such as these, we can achieve financial returns and at the same time advance promising innovations,' says Tessa van der Valk.
Wijsenbeek also points out the possibilities offered by the implementation regulation. 'The change makes it possible to contribute to the social objectives of a fund through impact investments in a scalable and financially sustainable manner.'
The change in implementing regulations marks an important step in facilitating impact investments by philanthropic funds. By removing previous barriers and simplifying the investment process, it marks an important step towards a sustainable and impactful future. As more philanthropic funds follow suit, the potential for lasting positive change continues to grow.
