Impact Investing

//Impact Investing

Reducing risk, extra returns, and being nice with it. That’s ESG

FOLLOWING last week’s column on Environmental, Social and Governance (ESG) investing, what are the issues to look out for when screening for the best returns and best funds to choose? In the ‘beginning’, we had ethical funds, sustainable funds and socially responsible funds. Now we have the term ESG. Ethical funds avoided anything that did

On Philanthropy: Understanding the “why” of impact investing

Impact investing is the rapidly expanding approach to financial markets that seeks to do well and to do good. It attempts to generate positive financial and social returns. Sustainable, responsible and impact-investing assets now account for $12 trillion of the $46.6 trillion in total assets under professional management in the United States. This is one of every four

New investment for businesses to tackle ocean plastics crisis

Plastic pollution is creating an environmental crisis in the oceans. According to the United Nations (pdf), more than 8 million tonnes of plastic enter the water every year, killing up to 1 million sea birds and 100,000 mammals, turtles and fish. Unless significant action is taken, the amount of plastic in the seas will triple by 2025. New

How social entrepreneurs made an impact at Davos 2019

Over 3,000 leaders, including more than 50 heads of state, last month descended on the mountain town of Davos for the World Economic Forum’s Annual Meeting 2019, under the theme Globalization 4.0: Shaping a Global Architecture in the Age of the Fourth Industrial Revolution. Among them were a delegation of 20 pioneering Schwab Foundation Social Entrepreneurs, coming

Impact Investing Isn’t Just For The Rich – We All Have A Part To Play

As one of my New Year’s resolutions, I’ve introduced my children to an excellent idea I heard once at an event on gender lens investing (which is, by the way, a whole other interesting angle I’ll come back to at another time!). Basically, the idea is that when your children get pocket money or Christmas

The surge of socially responsible investing

STANDING next to a plaque in the pure silent outback of Australia, the statement opened with ‘when the first Europeans came here…” with no mention of the indigenous people who had lived there for 45,000 years before. They say history is written by those in power, but it's also written in the present tense in

Winning At Climate Change Investing

As strange as it might seem considering the increasingly frightening data and scientific studies being published nearly data (Greenland's Melting Ice Nears a 'Tipping Point,' Scientists Say - NY Times, Oceans warming faster than expected: scientists - Reuters), the effects of climate change are not yet thought of as “Bad” by most Americans. Despite your humble correspondent’s best

The Sustainability Game

When it emerged on the scene a decade ago, sustainable finance was widely regarded as little more than a boutique business for a relative handful of concerned investors. Today, it might be on the cusp of prime time. “They said that 2018 would be the year of socially responsible investing. Now they say 2019,” says

Cultivating, Not Just Calculating, Social Impact

A recent article in Harvard Business Review provides an illuminating discussion of a new impact investing metric called the “impact multiple of money” (IMM). Developed by TPG Growth’s Rise Fund and the Bridgespan Group, the IMM entails a multi-step process whereby investors quantify and then monetize the predicted social and environmental benefits of an investment. The method’s applicability to

Impact investing is driving the most exciting emerging technologies

Last week, Adam Draper, Managing Director at Boost VC, the Sci-Fi pre-seed fund, tweeted he was looking for Ocean-related tech startups. “The Ocean is the oldest frontier, and it’s time to solve global problems with the latest technology,” he wrote, followed by “I’m obsessed, and want to profitably help the planet.” You might not have pegged Boost VC as an

Move beyond mere trade-offs in impact investing

Across the world, we are seeing a proliferation of entrepreneurs with a vision to create social impact at scale. In South Africa, a network of low-cost independent schools uses a blended learning model with technology to deliver world-class education to low- and middle-income students. In India, the next half billion people who will come online

U2’s Bono and TPG Launch Company to Measure ‘Impact Investments’

Bono and TPG are teaming up to try to prove that investments meant to benefit society at large do what they purport to do. The U2 frontman and his business partners at the U.S. private-equity firm announced a new company called Y Analytics, which will use a method they developed to measure social and environmental change created

How Impact Investing Can Amplify Philanthropic Efforts

For years, philanthropy and investing have been treated as separate disciplines—one championing social change, the other financial gain. The idea that the two approaches could be integrated in the same deals once struck most philanthropists and investors as far-fetched. Not anymore. Impact investing, which seeks to generate social and/or environmental benefits while delivering a financial

The New Era of Refugee Investing

More than three years into the pursuit of the Sustainable Development Goals (SDGs), not one country is on track to achieve them by the 2030 deadline. This conclusion, reached in a recent Brookings Institution report, highlights the enormous human costs associated with not meeting these goals, and implores countries to do more. With heads of state slated

Investing responsibly: Investors have power

Responsible investing is about more than doing good. It’s about securing long-term investment performance and mitigating risks by looking at investment, on more than just financial grounds. It focuses on three key areas that can make a difference to a company in the long term: environmental impact, social impact and corporate governance (commonly abbreviated as

Are Investors Finally Starting To Care About Social Impact?

In the investing world, there's always a hot new narrative. The narrative typically takes the form of an innovative product, a sector rotation or an "inevitable" theme. One narrative that I've been particularly interested in for the past couple of years is that of ESG investing. Environmental, Social and Governance (ESG) is the discipline of

The State of Socially Responsible Investing

In 2007, the European Investment Bank issued its first green bond, a EUR 600 million equity index-linked security, whose proceeds were used to fund renewable energy and energy efficiency projects. A year later, the World Bank followed suit, and by 2017, over $155 billion worth of public and corporate green bonds had been issued, paving

How to Evaluate Socially Responsible Investing

FINDING SOCIALLY responsible investments is easier than ever before, but questions still remain around just what impact these investments are actually having. A responsible fund may call itself a low-carbon exchange-traded fund, but how much carbon is it actually mitigating? "The challenge for impact investors is it can be hard to understand what's actually going on in

Stricter global standards needed for impact funds to work – OECD

Impact investment funds should be measured more strictly to ensure they are transparent about how much good their money is doing, the OECD said on Thursday, a day after a hoax letter on environmental investments hit global headlines. The funds, which promise social and environmental benefits as well as financial returns, could do more good