The gap between Main street and Wall street continues to grow and many Americans remain despondent about the role US banks played in the economic downturn. Morgan Stanley is closing this divide by making a key commitment to underpin homes and create jobs for low income families hardest hit by recent storms and floods in the US. In partnership with National Equity Fund (NEF), this is the second $100 million dollar commitment for affordable housing Morgan Stanley has made this year.
Over the years, Morgan Stanley has made the construction of affordable housing through The Low Income Housing Tax Credit (LIHTC) a core community investment strategy. In 2010 the company aided in the creation or rehabilitation of 3,680 units. By leveraging the LIHTC, one of the most prolific tools for housing development in the United States, companies are helping the NEF to respond to a critical need of residents of the US southeast and southwest.
However, their commitment to developing housing is a bit ironic, given during the heart of the US economic crisis, Morgan Stanley became synonymous with packaging toxic mortgage loans into securities. As of April this year, they will likely pay settlements to the US Securities and Exchange Commission for their role in selling mortgage bonds prior to the collapse of the housing market.
Does their role in the US housing market collapse taint their community strategy? The investments do come at a time when devastated communities have been starved of equity to finance low-income housing, and there is a critical need for sustainable level of capital for community development. They will help expedite the rate at which the houses are being built and jobs are being created. But, if they want to be seen as a catalyst for low income housing revitalization, they should clean up the financial disaster they helped create in 2008.
Jessica is a consultant in Corporate Citizenship’s US office. Email her at Jessica.sultzer@corporate-citizenship.com to discuss reporting, strategy development and community impacts.
Barclaycard Horizons announces grants for loan parents
Barclaycard has announced £150,000 in funding for educational grants to help loan parents back to work. The loans, part of the Barclaycard Horizons programme, are open for applications from July and aim to cover a wide range of funding needs for loan parents and their children through money, education and employment support. Research from the National Statistics Office shows that although 57% of single parents were working in April, many more would have liked to be. So far 450 parents and children have been helped by the Horizons scheme since its inception in 2005 and 97% of beneficiaries felt that the grant improved their employment prospects.
In June HP and no for profit organisation Positive Innovation for the Next Generation (PING) announced they are launching a mobile health monitoring technology aiming to enhance protection and prevention against malaria outbreaks in Botswana. The program equips health care workers with HP Palm Pre 2 smartphones allowing them to collect malaria data, notify the Ministry of Health of outbreaks and tag data and disease surveillance information with GPS coordinates. The program will be run in partnership with the Clinton Health Access Initiative and mobile network provider MASCOM. A year long pirate of the program will contribute towards the first ever map of the transmission of disease in Botswana and hopes to enable faster response times and a clearer measurement of cases.
Morgan Stanley announces program to accelerate affordable housing
Morgan Stanley and National Equity Fund (NEF) have announced a development program targeted at thirteen American states that have been devastated by floods, storms and tornados. The initiative aims to accelerate the housing development process, providing jobs for people in the community and houses at a faster rate by investing in projects using Low Income Housing Tax Credits (LIHTC). NEF, a national syndicator of LIHTC, will manage the $100 million “Rebuilding Local Economies Fund,” which Morgan Stanley is establishing, with the potential to provide around 4000 new jobs and replace up to 1000 units. The fund will also place a focus on building ‘green’ housing. To qualify for funding projects must begin construction by March 2012.
Kraft Foods invests $10 million in empowering women to improve food security
As part of Project Laser Beam, a five year public-private partnership led by the United Nations World Food Programme, Kraft Foods is partnering with Helen Keller International to help families facing malnutrition. The partnership aims to help families in the East Nusa Tenggara region of Indonesia, where 58% of children under age 5 have stunted growth due to malnutrition, and in the Satkhira district of Bangladesh, where about half of the children under age 5 are malnourished. The initiative strives to empower women as the gatekeepers to family food security; by teaching sustainable farming skills and nutrition education and creating microenterprises. Kraft have committed $10 million to the $50 million Project Laser Beam partnership.
BIG Fund launches calls for social investment proposals
The non- lottery funding operated by the Big Lottery Fund (BIG), known as the BIG Fund, has called for social investment organisations to bid for a share of the £5million fund, formed from dormant bank accounts in England. Following directions from the government for BIG to establish an investment committee, the Fund will help in creating a dynamic social investment market providing financial products to social investment and charity organisations. BIG are hoping to support five organisations through this scheme, chosen by an investment committee and to begin making investments from summer 2011. The Fund acts as a prelude to the Big Society Bank which will become fully operational following State Aid approval and Financial Services Authority authorisation.
Communities collaborate on sustainable smart town project
A town, “Fujisawa Sustainable Smart Town (Fujisawa SST)” is to be developed by nine companies using environmental initiatives through eco-urban development and smart city projects. Fujisawa and the surrounding regions will also participate in globally promoting Fujisawa SST as a model project. The nine companies; Accenture, Mitsui & Co., Ltd., Mitsui Fudosan Co., Ltd., Nihon Sekkei, Inc., ORIX Corporation, PanaHome Corporation, Panasonic, Sumitomo Trust & BankingCo., Ltd. and Tokyo Gas., Ltd. will build the smart town in the vacant lot of Panasonic’s old site. The town will hold around 1000 houses, demonstrating efficient energy use, and promote a sustainable lifestyle.
Santander donates £100,000 to support financial capability
Santander has announced a £100,000 donation to Citizens Advice, the national organisation, which provides information systems, training and support to the Citizens Advice Bureaux. The donation is expected to benefit 20 regional bureaux, allowing approximately 25,000 more people to have access to support and advice on how to handle their money.
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