Support and Investment go Hand in Hand – Interview with Markus Ziener on the publication of the Funding and Financial Report 2018
With SAGST explizit, the Software AG Foundation publishes its annual funding and financial report for the previous financial year. It appears exclusively online, on the foundation website. In addition to facts and numbers about grants and support work, it also includes financial figures. In this short interview discussing the 2018 financial numbers, CFO Markus Ziener discusses challenges, performance, the foundation’s investment strategy, and the importance of sustainability for asset management.
How do you evaluate the financial year 2018, and what do you expect in 2019?
2018 was a challenging year for all investors. Trade conflicts influenced the global economy and slowed economic growth. Despite this, we were able to use the low interest rate environment, combined with favorable loans, to achieve a positive result in our real estate area. We performed well on the capital market and were able to close the financial year with only a slightly negative result. All direct company shareholding produced solid dividends. So far, 2019 has been positive across all asset classes. Already in the first quarter, we were able to compensate for the previous year’s losses in securities investments in special market funds with income from shares and bonds. We are expecting this trend to continue in all investment classes in the second half of the year.
How would you describe the investment strategy for 2018?
As in the past, we continued to pursue our investment strategy with a “steady hand.” The foundation’s endowment funds are not play money, after all. Instead of speculation and derivatives, we purchase shares or bonds directly, or directly purchase company shares or real estate. In the latter asset classes in particular, a very long-term investment horizon is important to us. These kinds of investments require us to know and follow every investment in detail. In light of this, in 2018 we decided to further expand our investment controlling.
What role does “sustainability” play in SAGST’s current and future asset investment?
Sustainability in asset investment is a flexible term, which is in part controversially discussed and very differently defined. For me, though, a monetary investment is only sustainable, in a real sense, when the money that has been invested exists at any time in a material sense. This understanding of sustainability is also reflected in the foundation’s Charter, according to which the assets are to be maintained in their substance, including compensating for inflation. Furthermore, sustainable investment is achieved at SAGST by not investing in companies, shares, or bonds that would be in contradiction to our grantmaking and support activity. In the last two years, we have gone a step further and have ensured that, when we make direct investments in companies, asset investment goes hand in hand with the foundation’s purpose. An example of this kind of so-called “mission investment” is Chancen eG, which offers a solidarity model for university financing, and which is developing very dynamically. In the future we want to slowly expand this type of investment, which is admittedly very demanding.