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A family opens up about its investment mistakes

An additional layer of complexity is getting a family to agree to change course. Creating a strategy from scratch is not easy, but scraping the old for a new one is more challenging than an unmarried, said John Zimmerman, president of Ascent Private Capital Management, the high-net-worth arm of the US bank.

“It’s more difficult and complex than a blank slate of paper,” Mr. Zimmerman said. “You need to get alignment from scratch or from an existing foundation.”

At the time of the Board of Trustees vote to change the investment strategy of the Nathan Cummings Foundation, its $ 450 million portfolio could be called a less-progressive investment. Only 43 percent of the money was invested in a foundation report I quickly discovered called “no-go” assets – fossil fuels – while 44 percent was invested to “avoid losses.” . Historically the purpose of money, such as “contributing to the solution,” to ignore black businesses, was actually a rounding error: 0.1 percent, or about $ 450,000.

Nevertheless, the board was initially suspected. John Levy, an unaffiliated trustee and an entrepreneur who runs Seeqc, a quantum computing company, said he was concerned that the board then could not meet its goals through the available investment products.

“I wanted to make sure that people who have the same intentions as this group can pay their salaries and make their grants, and that we can do that in many years,” he said.

But Ruth Cummings, who is Nathan’s granddaughter and then chair, prompted the committee to consider how a change in investment could increase the grant’s impact.

Four years later, the “no-go” bucket is less than 5 percent; The “avoid loss” investment is still around 44 percent. But investment in another bucket, “profit to stakeholders”, has increased significantly by 27 percent. That is to say, a private equity fund that supports companies that improve the quality of health care. In addition, the investments made to “contribute to the solutions” are about 19 percent.