Program-related investments (PRIs) are gaining attention from foundations for their potential to meet charitable purposes while generating financial returns, but their use remains limited, a new study by the Indiana University Lilly Family School of Philanthropy finds. Leveraging the Power of Foundations – An Analysis of Program-Related Investing, which was sponsored by Mission Throttle, analyzes key trends in foundations’ use of program-related investing. The report examines funders’ motivations and strategies for making PRIs and identifies potential obstacles and opportunities for expanded use of PRIs to advance charitable goals.

Among the study’s key findings:

  • Housing, community development and education were the program areas that received both the highest total dollar amounts
  • More than half of all PRIs were loans
  • Peer networks play an important role in supporting and educating foundations in the use of PRIs

“Our research shows that there is significant interest in and potential for program-related investments to help foundations advance their charitable goals, and many foundations that utilize PRIs report that they frequently produce successful results,” said Una Osili, director of research for the Indiana University Lilly Family School of Philanthropy. “There was notable growth in PRI use in the past decade compared to the previous decade, but to date they are being used by a relatively small fraction of all foundations.”

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