Pictured: Geoff Gerber, Chair of the Investment Committee at the Jewish Federation of Greater Pittsburgh’s Foundation
Championing Jewish Values Through Investments
With growing awareness of the impact of corporate decisions on social issues, the Jewish Federation of Greater Pittsburgh is working hard to ensure Jewish concerns and values are represented in American corporate boardrooms. By including an investment option licensing JLens’ Jewish screening, research and advocacy strategy (“Jewish Advocacy Strategy”) as part of its overall investment allocation, the Federation is not only providing a strategy designed to yield returns similar to the S&P 500 but also amplifying the Jewish voice in corporate America. In addition, the Federation’s assets under management which include donor advised funds and endowments, can invest their assets directly in a product licensing JLens’ strategy.
Geoff Gerber, Chair of the Investment Committee at the Jewish Federation of Greater Pittsburgh’s Foundation, has been a driving force behind this initiative. With a tenure spanning over two decades, Gerber's commitment to the Federation's mission is evident.
The Federation's relationship with JLens is part of a larger vision. As Gerber puts it, "The Jewish Federation of Greater Pittsburgh is the leading convener and funder of Jewish life for the 50,000 people in our Jewish community." Their mission extends beyond local boundaries, aiming to build "a safer, more inclusive world" by fostering collaboration and cultivating resources.
This mission aligns perfectly with JLens' approach. JLens does not just offer another screening strategy; it's a further means for Jewish advocacy. By using shareholder advocacy to influence corporate policies, JLens ensures that Jewish community concerns are considered in decisions that affect society at large. This alignment made JLens’ strategy an attractive option for the Federation.
The Federation's journey with JLens began in 2018 when they were exploring the ability to have social impact investing through a Jewish lens. They had long-standing investments in Israel bonds and had recently added Israeli equities through an ETF (Exchange-Traded Fund). When the Federation learned about JLens’ Jewish Advocacy Strategy, it seemed like a natural progression.
"The idea of using a portion of the Federation's investment portfolio to promote Jewish values and advocacy within U.S. public equities, which we've already invested in, seemed very worthy of due diligence," Gerber recalls. The Federation was particularly drawn to JLens' strategy, as they had been investing in S&P 500 index funds for years.
However, the decision to utilize the JLens strategy wasn't made lightly. The Federation conducted thorough due diligence, leveraging their investment consultant, Bilkey Katz, who found the strategy produced similar returns to their existing index fund provider.
This led to the formation of two subcommittees—one focusing on investment performance and the other on the impact of JLens’ Jewish advocacy. Both subcommittees reported positively. "After a thorough review, the impact subcommittee was comfortable with both the impact report provided by JLens regarding their Jewish advocacy and the actual impact of that advocacy," Gerber states. "The investment subcommittee was very comfortable that JLens’ strategy was designed to yield similar returns to the Vanguard S&P 500 Index Fund, where we were already invested, albeit with a slightly higher licensing fee but we were willing to absorb that for the added benefit of the Jewish advocacy element of JLens."
In July 2019, the Federation made its first investment in a product licensing JLens’ Jewish Advocacy Strategy, starting with 2.5% of its total portfolio. This initial allocation was strategic, allowing them to closely monitor the performance. The investment committee was impressed with the results, both financially and in terms of advocacy impact. Consequently, they increased their allocation to 5% after two years and then to 10% a year later.
Today, this represents a significant portion of the Federation's investments. Out of their $350 million in assets under management, 10% is invested in a product licensing JLens’ strategy. This translates to 16% of their public equity allocation and a remarkable 27% of their large-cap equity portfolio. As the Federation’s investment allocation grew from 2.5% to 10%, their investment management annual fee rate was reduced due to a tiered fee schedule offered by the advisor licensing JLens’ strategy. This has resulted in a lower fee differential relative to passive index strategies which do not provide Jewish advocacy.
The Federation's commitment to JLens reflects its broader emphasis on socially responsible and Jewish values-based investing. Their investment policy stipulates that roughly 10% of the total fixed income holdings should be in Israel bonds. They also invest in Israeli equity ETFs and have a "mission investing" section that allows for strategic investments enhancing the Jewish community.
What makes JLens’ strategy particularly appealing to the Federation's donors? It's the opportunity to combine returns similar to the S&P 500 with effective advocacy on Jewish communal concerns. "As they continue to grow, their seat at the corporate table becomes more relevant, which strengthens their ability to promote Jewish values," Gerber explains.
This dual benefit—financial returns and Jewish advocacy—resonates strongly with charitable fund holders. Gerber has witnessed this firsthand: "From experience having made several presentations to both current and prospective fund holders over the last five years, it's clear that fund holders really appreciate and value the Foundation's selection of JLens’ Jewish Advocacy Strategy."
"We thought it would be appealing," Gerber notes, "and it certainly has proven to be so. Happy investors make for a happy Investment Committee."
JLens's advocacy complements the Federation's mission. "The Jewish Federation of Greater Pittsburgh focuses on strengthening Jewish life, supporting those in need, and building a safer, more inclusive world," Gerber explains. JLens’ strategy offers a means to advance these goals by advocating to combat antisemitism and hate, support Israel, and promote tikkun olam initiatives that align with Jewish values.
Given their positive experience, the Federation offered some advice to other Jewish organizations considering values-based investing. Gerber recommended starting with the investment policy: "Make sure that your investment policy statement incorporates a section on mission-based or Jewish values-based investing." This formal inclusion allows foundations to invest prudently while promoting desired outcomes.
He also suggests a gradual approach, similar to the one adopted by the Jewish Federation of Greater Pittsburgh: "Start off with an initial allocation licensing the strategy and plan on reviewing that allocation after a year or two." This method allows organizations to assess both financial returns and mission-based objectives before increasing their commitment.
The current climate of rising antisemitism and hostility toward Israel has only reinforced the Federation's belief in JLens' importance. "It's scary to see some of the shareholder proposals that are popping up regarding divestment of Israeli investments or Israeli equities," Gerber admits. "Now more than ever, having a strong voice promoting Jewish values, such as JLens, at the corporate table is really critical."
As investments in products licensing JLens' Jewish Advocacy Strategy have grown from $50 million when Pittsburgh first invested to over $260 million today, its influence has expanded proportionally. This growth is particularly timely. "In today's world, even more so since October 7th, more voices are now coming out against Israel," Gerber observes. "It's really important to make sure that we have representation around the corporate tables, and JLens does that."
Gerber concluded with a poignant thought: "the Jewish community is obviously in the minority, but we can have a bigger voice at the corporate table through JLens," he stressed. “In offering JLens’ strategy, the Jewish Federation of Greater Pittsburgh is not just managing assets; it's amplifying Jewish values in the heart of corporate America, ensuring that the community's voice is heard where it matters most.”
As of June 30, 2024, over 30 Jewish institutions, representing $10 billion in communal capital, have invested approximately $260 million in products licensing JLens' Jewish screening, research and advocacy strategy (“Jewish Advocacy Strategy”) since 2015. On behalf of the Jewish community, JLens conducts research and advocacy with the 300+ U.S. public corporations held in this screening strategy.
This information is for educational purposes only and should not be interpreted as investment advice or an investment offering. Investors should consult with an advisor to determine the suitability of any investment option or strategy. JLens is not a registered investment advisor, makes no representation as to the advisability of the strategy or investing in any investment fund or other vehicle. Composition of the strategy’s portfolio is subject to change. JLens disclaims responsibility or liability for any advice given to third parties or decisions to invest in any investment or other vehicle by you or third parties based on the information. Any investment in funds involves a risk of losing money. Past performance is not indicative of future results.
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