The University of Maryland Medical System dedicates 1% of its $1.4 billion investment portfolio to companies and funds focused on reducing economic inequality, particularly in Maryland.
Many hospital systems have investment portfolios and use debt service returns, but UMMS CEO Mohan Suntha said he and other medical system leaders realized these funds could do much more. What if some of these investment funds could also have a social impact?
On Thursday, UMMS announced $14 million in investments across 11 companies, most of which are focused on Maryland and have black and female leaders.
“This is just another step in our evolution,” Suntha said, calling the $14 million investment a “great source of pride.”
The 11 recipients are:
- The Reinvestment Fund, a community development lender in Baltimore, $2.5 million
- Obran, a worker-owned co-op focused on job creation, $1 million
- Baltimore Community Lending, a Baltimore-area small business lender, $1 million
- FSC First, a Prince George’s County small business lender, $1 million
- Ignite Capital, a group focused on community development in Baltimore, $500,000
- Enterprise Community Development, a non-profit developer of affordable housing, $1 million
- RBC Access Capital, a fund focused on affordable housing, $2.25 million
- Momentus Capital’s Impact Investing Program, a small business lender with an Access to Food Program, $2.5 million
- Conscious Venture Fund II, a Baltimore fund focused on community development, $750,000
- Propel Baltimore Fund III, a Baltimore fund focused on community development, $750,000
- UpSurge, a Baltimore investment fund for startups, $1 million
Baltimore Community Lending, for example, funds some vendors in the new Lexington Market, UMMS said in a press release.
If these investments achieve their financial and social goals, Suntha said UMMS would consider expanding the initiative.
Along with 11 affiliated hospitals and other health care facilities across the state, UMMS employs nearly 30,000 people and has annual revenues of just under $5 billion. As CEO, Suntha earned $2.1 million in salary, according to the latest available tax returns. UMMS, like all hospitals and hospital systems in Maryland, is a not-for-profit organization, which means it is tax-exempt. While nonprofit hospitals are required to provide community benefits, Suntha said this investment initiative is unrelated to those requirements.
Instead, he said, it made sense.
Suntha said the $14 million investment goes beyond the hospitals’ primary focus — acute care — and actually goes upstream to address issues that can affect a person’s health. Using investments to create jobs and opportunities creates healthier and more vibrant communities. He said he hopes it will encourage other big institutions to reconsider their investment portfolios – and how that money could do more than provide a return on investment.