The University of Maryland Medical System is devoting 1% of its $1.4 billion investment portfolio to companies and funds focused on closing economic inequality, particularly in Maryland.
Many hospital systems have investment portfolios and use the returns to service debt, but UMMS CEO Mohan Suntha said he and other leaders at the medical system realized those funds could be doing much more. What if some of those investment funds also could have a social impact?
On Thursday, UMMS announced $14 million of investments spread among 11 firms, most of which are focused on Maryland and have Black and female leadership.
“This is just one more step in our evolution,” said Suntha, 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 cooperative focused on job creation, $1 million
- Baltimore Community Lending, a small business lender in the Baltimore area, $1 million
- FSC First, a small business lender in Prince George’s County, $1 million
- Ignite Capital, a group focused on community development in Baltimore, $500,000
- Enterprise Community Development, a nonprofit developer of affordable homes, $1 million
- RBC Access Capital, a fund focusing on affordable housing, $2.25 million
- Momentus Capital’s Impact Investments Program, a small business lender with a food access 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, is financing some vendors at the new Lexington Market, UMMS said in a news release.
If these investments meet their financial and social goals, Suntha said UMMS will consider expanding the initiative.
With 11 affiliated hospitals and other health care locations across the state, UMMS employs nearly 30,000 people and has annual revenues just under $5 billion. As CEO, Suntha made $2.1 million in salary, according to the most recently available tax disclosures. UMMS, like every hospital and hospital system in Maryland, is a nonprofit, meaning it is tax exempt. While nonprofit hospitals are required to provide community benefits, Suntha said this investment initiative is not related to those requirements.
Instead, he said, it just made sense.
Suntha said this $14 million investment goes beyond the primary goal of hospitals — acute care — and actually goes upstream to address issues that can affect a person’s health. Using investments to create jobs and opportunity creates healthier and more vibrant communities. He said he hopes that this encourages other large institutions to reconsider their investment portfolios — and how that money could be doing more than providing a return on investment.