When the FordFoundation took the unprecedented step in June 2020 of issuing $1 billion in debt to help stabilize other nonprofits, it delighted investors and inspired several other large foundations to follow suit.
Responding to what the MacArthur Foundation called the “twin pandemics” of COVID-19 and systemic racism, the foundations mostly issued social bonds ranging from $100 million to Ford’s $1 billion. The unusual moved allowed them to increase their donations and take advantage of favorable market conditions, instead of dipping into their endowments.
“It allowed them to double their annual investing in their organization, which is kind of amazing,” said Ratliff. Following Ford’s lead, the Rockefeller Foundation issued $700 million in bonds. The Bush Foundation used the $100 million from its bond issuance to launch two new community trust funds focused on closing racial wealth gaps. The California Endowment worked with partners to develop plans to support movement building and health care infrastructure with the $300 million they raised through bonds.
The foundation committed to spending the remaining funds over 5 years and has put a significant portion into a vehicle called the Rockefeller Foundation Catalytic Capital.