125 Years of Transformation
Contributed in 2013

$8.4 Million
To Environment Causes

Contributed in 2013

$10.4 Million
To Education Causes

Alcoa Foundation invests where Alcoa has a presence to further sustainability and to partner with communities in addressing local needs as they adapt to a rapidly changing world.

All of our funding decisions and engagement priorities are guided by two key themes:

  • Environment: Bringing about measurable and systemic improvements in environmental sustainability through best practices in environmental management and pioneering solutions.
  • Education: Supporting education and training where Alcoa can offer expertise and make a difference in manufacturing, the environment, and safety.

50 percent of Alcoa's Foundation budget is earmarked for our global signature partnerships. The other 50 percent is allocated to Alcoa Operating locations Groups and Regions that develop localized strategies to address specific community needs and interests – some of which may not be reflected in our global approach – to recognize the unique challenges posed in different markets.

Our Global Mission:

  • Promote environmental stewardship
  • Prepare tomorrow’s leaders
  • Enable economic and social sustainability in the communities in which we live and work
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A letter from our president


Elsa Ozer, President of Alcoa Foundation

In 2013, Alcoa celebrated its 125th anniversary – a noteworthy milestone by any measure. For Alcoa, the year was marked by a decided transformation from a commodity company to one that is focused on growth businesses, innovation and value-creating technologies.

“We are well-prepared and fully committed to achieve the Alcoa vision – “Advancing each generation” – for our shareholders, customers, employees, communities and partners.”
Alcoa Chairman and CEO Klaus Kleinfeld, 2013 Letter to Shareholders

The idea of a “transformation” really resonates with us at Alcoa Foundation. We are as energized by that dynamism in the business as we are by the notion that our CSR work can bring new life to the natural environment; or that an underperforming student can ignite a passion for science and technology; or that an unemployed individual can acquire critical technical skills, find rewarding work and secure his or her economic future. During times of transformation, we think and do things differently, and we take our future into our own hands.

In that spirit, and in recognition of Alcoa’s milestone anniversary last year, our Foundation partnered with dozens of high-impact non-profit organizations to enable positive, community-oriented change in dozens of countries worldwide. A major part of that transformation was spurred by Alcoa employees, who donated more than 850,000 service hours in 2013. During our annual Month of Service alone, we saw a record 62% of Alcoa employees give their time and energy in more than 1,300 community-based events that lent a helping hand to more than a half million people.

You will read in this report about just a few of the hundreds of transformative programs that Alcoa Foundation, together with our nonprofit partners, initiated last year. We launched one in particular to commemorate Alcoa’s 125th anniversary and help prepare young people around the world for rewarding and stable careers in the manufacturing and technical fields. Our “Advancing Each Generation 125th Anniversary Internships,” developed in partnership with non-profit organizations in eight countries, will place more than 500 unemployed young people in manufacturing and technical internships. That pathway from unemployment to a viable and attractive career is one that Alcoa Foundation is immensely proud to help bring to life.

As the newly named Alcoa Foundation President, I have shared in that pride and gratitude to our non-profit partners and the 60,000 Alcoa employees who help strengthen our communities and transform lives every day. With an eye to 2014 and beyond, I know that our combined efforts will lend resilience and positively impact our communities, helping them grow and thrive for the next 125 years.


Esra Ozer
President, Alcoa Foundation

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AWARDS

In 2013, Alcoa Foundation was honored to be recognized for our work
and corporate citizenship across the globe.

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Endowment Investing Strategy

Alcoa Foundation’s assets are considered to be a perpetual pool of capital. The objective of the investment strategy is to preserve the real (inflation adjusted) value of the assets to maintain the real value of its program spending over the long term to support the goal of contributing 5 percent of the value of its assets each year. The Alcoa Foundation’s assets were $468 million at year-end 2013.

The portfolio's investment strategy has been revised to reduce and diversify the investment risk taken to achieve our long-term objective via increasing both asset class and risk factor diversification. The strategy revisions are expected to increase the probability of achieving our long-term investment objectives while reducing the risk of experiencing large short term portfolio draw downs. Specifically, we meaningfully reduced the allocation to public equities and increased the allocation to macro and equity long/short hedge fund strategies, US inflation protected securities and long duration US Treasury securities.

The revised investment strategy helped us to generate a solid 2013 investment return of 7.1% which outperformed our passive performance benchmark by 1.2% and our 5% real return objective. Through 2013, Alcoa Foundation's investment returns outperformed its passive investing benchmarks for all time periods (1, 3, 5 and 10 years).


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