June 1, 2021

New $25M Investment in Community & Economic Development Bonds

Community and Economic Development Bonds In late March, Portico’s investment team made a $25 million social impact first investment in Nuveen’s Community & Economic Development bond portfolio through the ELCA retirement plan. This investment is designed to foster affordable housing and economic development in communities of need while creating positive financial returns.

It’s important news for those invested in Portico’s social purpose funds and the ELCA. This large-scale investment through Nuveen, an investment manager and subsidiary of industry giant TIAA, is a serious commitment to helping communities in need ― an ELCA priority recently affirmed by Presiding Bishop Eaton. In an April video message, Become active, dear church, she called the ELCA to strengthen support for communities where many residents — in particular, people of color — are living in poverty.

“We witness acts of violence, particularly against black and brown people, on an almost daily basis. This church, the ELCA, has passed social statements on a just economy, on education for all, on health care … on racism, on immigration and migrants,” said Bishop Eaton. “We’ve passed those; they have implementing resolutions. … We’ve made some difference. But now it’s time for all of us to take a look at those again,” she said, “and start to work for the change that will make it clear that one’s ZIP code does not determine one’s destiny.”

New Investment Customized to Strengthen Disadvantaged Communities

Guided by Portico’s commitment to achieve measurable social impact through its social purpose funds as well as the ELCA Community Economic Development social criteria screen, Portico asked Nuveen to propose a fixed income portfolio. Tapping its extensive community economic development bond experience, Nuveen proposed a strategy focusing investment in community economic development and affordable housing projects, primarily within the U.S.

In addition to Portico’s standard protocols, Portico reviewed this potential investment with the ELCA’s Corporate Social Responsibility Review Team. Following its due diligence, Portico’s investment team directed $25 million into its Nuveen account — through all its social purpose target date funds and the Portico Bond Social Purpose Fund.

As portfolio manager, Nuveen committed those dollars to investments custom-selected to align with the ELCA screen. Specifically, this screen calls for:

  • Investments in organizations that promote economic development of communities characterized by a high proportion of people living in poverty and/or people of color.
  • Investments that include, but are not limited to, low-income housing, job creation and training, social services, public health, food and agriculture, infrastructure, community entrepreneurship, small business development, and financial services.

Because this entire Nuveen portfolio is made up of social impact first (SIF) investments, ELCA retirement plan members are invested in these funds for two kinds of returns: financial returns and regular reports quantifying the positive social impact created. (Reminder: SIF investments can represent up to 10% of a social purpose fund’s assets; see below for details.)

“We’ve always maintained some investment in community development bonds,” said Erin Ripperger, Portico’s senior socially responsible investment analyst, “but most of them haven’t been SIF investments. The Nuveen investment more than doubles our commitment to community economic development. And it brings our overall SIF investment — in the environment, human rights, and community economic development across all our social purpose funds — to nearly 8%, much closer to our 10% limit.”

This chart lists the types of investment solutions Portico’s portfolio will target as well as metrics Nuveen can use to demonstrate positive social impact. Because it takes time to monitor and quantify impact, Nuveen’s first social impact report related to Portico’s investment is expected in fall of 2022.

Affordable Housing

Social Impact

  • Low- and moderate-income housing loans
  • Transit-oriented development
  • Walkable communities
  • Mixed-use development projects


  • Number of affordable mortgages guaranteed or provided
  • Housing built or supported, including units designated for low- to moderate-income residents

Community and Economic Development

Social Impact

  • Benefits underserved and/or economically disadvantaged communities
  • Services: financial, hospital/medical, and educational
  • Urban revitalization: community centers, reconstruction activities
  • International development and humanitarian activities: disaster relief, economic aid, and agricultural support


  • Number of full-time jobs created
  • Number of farmers and fishers trained
  • Number of people reached through community programs

Example: Social Bond Investment in Ford Foundation

To establish Portico’s portfolio, Nuveen made a number of community and economic development investments, including an investment in a social bond issued by the Ford Foundation. This nonprofit makes grants to reduce inequality in its many forms, focusing on civic engagement and government, gender, racial and ethnic justice, technology and society, natural resources and climate change, future of workers, creativity and free expression, and cities and states.

When COVID began to shut down in-person fundraising events and corporate giving, the Ford Foundation issued its first Social Bond in June of 2020 to support its nonprofit partners dependent on those income sources. This bond is designed to create a one-time allocation of up to $1 billion over two years, nearly doubling the Ford Foundation’s annual endowment. Funds generated will support partner organizations in need that are either tackling inequality or funding under-resourced areas, domestically and internationally. The foundation will track which of its partners receives additional funding and will create a summary impact report by program area when all proceeds have been distributed.

From the Ford Foundation’s Social Bond web page: “Nonprofits and the critical services they provide have never been more necessary, yet more than half of these organizations struggle to become financially sustainable and meet that demand. … With the rapid spread of COVID-19, the entire nonprofit sector is at risk of being fundamentally upended by the virus and its economic fallout.”

Portico’s Second Nuveen Investment

If this story sounds familiar, there’s a reason. Portico made a $25 million SIF investment in a Nuveen green bond portfolio in 2017 focused on renewable energy, climate change, and natural resources, and has been reporting annually on the positive environmental impact it is generating.

“We selected Nuveen to manage this new investment based on our positive experience with its green bond portfolio,” Ripperger said. “But the depth of their community and economic development experience was also a key factor. Nuveen is a long-time participant in the community and economic development space with a dedicated socially responsible investing team and a market-leading presence.”

Social Impact First (SIF) Explained

To help achieve measurable social impact, Portico employs a form of positive social investing called social impact first (SIF) on up to 10% of fund assets in 14 of its 15 social purpose funds (Portico Stock Index Social Purpose Fund excluded). SIF investments can accept a somewhat lower projected return and/or somewhat higher projected risk on up to 10% of the fund’s investments in order to invest in companies and organizations that support initiatives like affordable housing, community economic development, reduced greenhouse emissions, and renewable energy. ELCA retirement plan members have the option to invest a portion, or all, of their account in Portico’s social purpose funds.


Information regarding Portico funds should not be considered as advice or as a recommendation to hold, purchase, or sell those financial products and does not take into account your particular investment objectives, financial situation, or needs. For more information about all funds managed by Portico Benefit Services, please see the Investment Fund Descriptions for your retirement plan on the Fund Options & Performance page of myPortico and speak with your tax, legal, or financial professional.

Members should carefully consider the target asset allocations, investment objectives, risks, charges, and expenses of any fund before investing in it. All funds, including the Portico funds, are subject to risk and uncertainty. Past performance is no guarantee of future performance. Funds managed by Portico Benefit Services, including the Portico funds and ELCA Participating Annuity Investment Fund, are not insured or guaranteed by the Federal Deposit Insurance Corporation, any other government agency, or the ELCA. Fund assets are invested in multiple sectors of the market. Sectors, like funds, may perform below expectations and lose money over short or extended periods. Review the Portico Investment Fund Descriptions and the Investment Memorandum for the ELCA Participating Annuity Trust for more information about the Portico funds.

Target date funds are designed for members expecting to retire around the year indicated in each fund’s name. When choosing a fund, members should consider whether they anticipate retiring significantly earlier or later than age 65, and select the target date fund that aligns with their expected retirement age. There are many considerations relevant to fund selection; members should choose the fund that best meets their individual circumstances and investment goals. Each fund’s asset allocation strategy becomes increasingly more conservative as it approaches the target date and beyond. Each fund’s investment risk changes over time as its asset allocation changes. The investment process used by the investment managers and the target asset allocation of the funds may change at any time, without notice.

Neither Portico Benefit Services nor the funds it manages are subject to registration, regulation, or reporting under the Investment Company Act of 1940, the Securities Act of 1933, the Employee Retirement Income Security Act of 1974 (ERISA), the Securities Exchange Act of 1934, the Investment Advisors Act of 1940, or state securities laws. Members, therefore, will not be afforded the protections of the provisions of those laws and related regulations.