-Press Release-
February 6, 2002
Cascadia
Revolving Fund Invited to World Economic Forum
Seattle, WA-
Cascadia Revolving Fund, a nonprofit
community development financial institution with offices in Seattle
and Portland, was one of just 11 organizations worldwide invited
to attend the World Economic Forum as an accredited intermediary
of the Global Exchange for Social Investment (GEXSI), now in
its pilot phase. Cascadia provides financing and related technical
assistance to low-income entrepreneurs in Washington and Oregon,
with a focus on women, minorities, immigrants, and businesses
located in distressed rural communities. In the sixteen years
since its inception, it has earned a high national and international
reputation in the community development lending industry.
At last year's World Economic
Forum in Davos, Switzerland, a panel discussion on social entrepreneurship
highlighted a serious problem: charitable projects were going
unfunded not because of a lack of willing investors but because
investors could not find or properly evaluate them. The
non-profit world needed a mechanism for rating charities and
presenting their initiatives and funding needs to a large group
of social investors. A year later, at this year's WEF in New
York, investors got just what they asked for. The Global Exchange
for Social Investment was introduced to 70 leading donors, including
Michael Dell and George Soros, at a private lunch on Monday.
The exchange, which is in its
pilot stage, was offered in two forms - a thick, red catalogue
and a website, www.gexsi.org.
Both give information on 88 projects from 11 organizations, which
were accredited by Bain & Company over the last few months.
Bain worked with the Schwab Foundation for Social Entrepreneurship
and a consortium including the Soros Foundation, Deutsche Bank,
the accountant PwC, Foursome Investments and the Endeavor and
Ashoka charities on the project.
The charity groups were measured
against strict financial, organizational, and portfolio criteria,
gleaned from interviews with the social investing community.
Projects were then categorized by geographical location, the
social problem being tackled and the type and number of people
helped. "If I'm a donor, how do I know which [charities]
are good and which ones aren't?" said Pamela Hartigan, managing
director of the Schwab Foundation. "There has been a hesitancy
by non-profits to equate themselves with big business, but more
and more they are realizing that...there need to be mechanisms
for quality assurance and transparency."
Whether donors are making grants,
offering low-interest loans or taking equity stakes, "there
is a lot of responsibility in giving money," she added.
"It's not philanthropy, it's an investment." GEXSI
is designed to help not only investors, by covering their due
diligence, but also charitable organizations, particularly ones
with smaller projects in more obscure areas that do not have
time or money to market themselves and raise funds.
"Corporate social giving
in the US increased 17 per cent [in 2000] but only 1.3 per cent
of the money went outside the US," Ms Hartigan explained.
"Most donors think about their local community. If they
try to go global, they're hopeless."
Local investments continue to
be important, but "we learned from September 11 that we
really need to look beyond our own backyard", she added.
GEXSI-listed initiatives include the Afghanistan Private Enterprise
Program, which is seeking $1.5m to introduce Afghani farmers
to commercial markets, and the Nonprofit Recovery Fund, a group
that wants to raise $30m to help
New York community organizations
recover from the drop-off in non-disaster-related giving following
September 11. Other projects address substance abuse in Russia
and child welfare in the Caribbean.
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