Foundations Slow to Deploy Program-Related Investments

Philanthropic foundations have an under-utilized source of capital to make loans, loan guarantees and equity investments in social ventures.


Since 1969, foundations have had the ability to use “program-related investments,” or PRIs, to invest in organizations that advance their “charitable purpose,” while earning a real financial return. The investments even count toward foundations’ legal requirement to each year pay out about 5 percent of their capital base (which, by the way, tops $600 billion).

Yet, fewer than one percent of all foundations all foundations use PRIs, according to an article in the Stanford Social Innovation Review. Author Jeff Chidester, director of policy programs at the University of Virginia’s Miller Center, says foundations are put off by the “costly and risky” regulatory regime governing PRIs.

Read more about the history and the possible future of PRIs.

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