A growing number of foundations are exploring how to better align their endowment investments with their missions. But success in this space requires more than good intentions—it also requires the right governance.
Investment committees often find themselves at a complex crossroads, tasked with upholding fiduciary duties and return targets while pursuing increasingly sophisticated impact goals. That’s why governance structure—particularly at the board and investment committee levels—is a crucial factor for reconciling these priorities effectively.
The 2023 Breaking Barriers report by Builders Vision and Social Finance found that lacking the right board and investment committee members is the single biggest barrier that organizations face. Conversely, one of the most powerful drivers of progress is having members who are aligned on the importance of impact investing.
At Builders Vision, this insight helped shape how we approached the evolution of the Builders Vision Foundation’s $3 billion endowment. Today, over 90% of our endowment portfolio is mission-aligned, and it continues to perform in line with market-rate benchmarks and long-term targets without compromising returns.
What made the difference? A deliberate governance choice: adding external members with impact investing experience to our investment committee. As our work evolved, we saw real value in bringing in additional practitioners and field experts with deep experience across philanthropy, investing and adjacent sectors. Rather than treating governance as a static structure, we approached it as a strategic lever—one that could expand our thinking, challenge our assumptions and ultimately strengthen outcomes.
Outside voices
Incorporating external members was not a symbolic gesture. It was an intentional shift in how we make decisions. The results have been tangible, sharpening both the substance of our investments and the rigor of our process in three critical ways:
- Expanding the field of vision. By bringing experience from diverse institutions and investment contexts, external members broaden our understanding of the investment landscape. They provide insights into funds, companies, and sectors, helping identify mission-aligned investment opportunities and informing our broader strategic choices.
- Strengthening our processes and operational rigor. Fresh eyes push us to strengthen how we evaluate every opportunity, from enhancing the structure of our investment committee memos to more effectively integrating impact and financial performance. Inclusion of external members encourages more strategic thinking around asset allocation, benchmarks and our overall investment policy to align with our impact goals while continuing to meet fiduciary responsibilities.
- Creating productive friction. Independent perspectives spark deeper debate and more rigorous thinking, especially in moments of ambiguity or transition. This holds us accountable to our standards, ensuring decisions remain disciplined and aligned with our evolving mission and strategy.
External member perspective
To pull back the curtain on how this dynamic works in practice, we spoke with two of our investment committee members.
Both Spring Point Partners’ Margot Kane and Pivotal’s Erin Harkless Moore serve as external members of our endowment’s investment committee and represent organizations that use a similar model of leaning on external perspectives. Drawing on their experience in mission- and impact-aligned investing, they provided reflections on how to move beyond standard governance toward a more collaborative—and fruitful—partnership.
What practices or structures help external members contribute most effectively?
Erin: It starts with the relationship between the investment committee member and the Chief Investment Officer. They need to be in regular dialogue to stay aligned on agendas and materials. That also requires flexibility around off-cycle meetings and communication across channels, so we can provide feedback exactly when the team needs it to keep decisions moving.
Margot: Context is everything. When leadership periodically shares broader updates on portfolio strategy or organizational shifts, it allows us to shape our feedback based on our understanding of the organization’s current objectives. I also value that Builders Vision introduces us to the full team, which helps build a sense of partnership rather than just a formal oversight relationship.
What helps create an environment where external members feel comfortable challenging assumptions or pressure-testing ideas?
Erin: This has to be driven by leadership. It’s about building a foundation of trust where everyone understands that challenging an assumption isn’t about “jamming anyone up”—it’s about getting to a better outcome. Because we are independent and not beholden to internal team dynamics, we can provide productive dissent that might not exist internally. When that trust is there, pressure-testing feels like a shared goal.
Margot: Bring us in early, well before the work is “fully baked.” We can share timely insights into how other organizations have tackled similar questions and offer a fresh perspective on the team’s decision-making by identifying habits that are often hard to spot from the inside. When we are involved in these formative stages, we can provide more meaningful feedback and feel bought into the final decision.
What advice would you give to foundations considering external members?
Erin: Cast a wide net. I’ve always admired foundations that treat this like a formal hire by creating a job description and being clear about expectations upfront. And don’t over-index on a member’s title or prestige. What matters more is relevant experience, alignment with the mission, and someone who’s actually willing to do the work—to review materials, show up consistently, and be a thoughtful sounding board.
Margot: Allocate the right leadership attention to the integration process. You need structured governance and clear delineation of authority between the CIO, the team and the committee, so that external members know exactly which lane they are weighing in on, and the internal team doesn’t feel disenfranchised. And think carefully about cadence. If you’re in a very active investment period or investing in complex transactions, quarterly meetings are often insufficient. After years of tinkering with this dynamic, our Spring Point investment committee meets monthly, not just to review performance but to show up as genuine partners to our investees as they navigate the complexity and risk that comes with early stage and higher risk markets.
Collective governance
Erin and Margot’s observations capture something that our own experience has made clear: External members are effective not just because of what they know, but because of how they engage. Thoughtful integration is less about a specific set of rules and more about intentionality about who participates and how decisions are reached.
The field is still evolving, and so are we. By sharing our own lessons learned, we hope to encourage more dialogue and learning alongside others navigating this same landscape. Good intentions are not always enough, but they are what bring us together—as we collectively advance mission-aligned investing and build the structures to support its growth.
Danielle Reed is managing director of investments at Builders Vision
