By: JoDeen Urban, Editor In Chief, The Source
The aspiration that as a global community we will leave the world a better place figures prominently in our collective psyche. Impact Investing is many things and at its heart is the compact that governments, companies and investors will collaborate towards this end. Acts of social and environmental conscience, executed in good faith, backed by sound financial reasoning with the expectation of profit – an ethos evidenced by the growing momentum and mainstreaming of impact investing.
Impact investors actively seek to place capital in businesses, nonprofits and funds that can harness the power of positive enterprise. These investors are primarily distinguished by their intentions to address social and environmental challenges. In contrast, practitioners of Socially Responsible Investing also include negative (avoidance) criteria as part of their investment decisions as discussed by our GSC Chair in her opening commentary of this issue.
Impact investing is on the rise and its relevance is undisputed.
According to the Global Impact Investment Network (GIIN) “Impact Investments” are investments made into companies, organizations, and funds with the intention to generate measurable, beneficial social or environmental impact alongside a financial return. Impact investments can be made in both emerging and developed markets, and target a range of returns from below-market to above-market rates, depending upon the circumstances. In this description, it is important to acknowledge that governments and global leaders are also at the forefront, not just providing their advocacy of this movement but actively engaging in the solution-making process.
In this month’s issue several prominent companies, a leading foundation, a rural sales and service company with microfinance roots, and individual contributors weigh-in on this topic. Each one has enriched the discourse on this subject, elevated the end-state vision and contributed to the creation of a financially inclusive and environmentally safer world. Whether it is Sutherland Global Services, Accion, US SIF Foundation, Frontier Markets, or our Board correspondent reporting this month from the UK, a common message is stressed – impact investing is on the rise and its relevance among clients, investors and the international capital markets is undisputed.
We encourage you to read each insightful, thought-provoking article as they reaffirm the power of the individual, the power of allied action, and the power of impact investing.
Editor In Chief
JoDeen is an independent management consultant working with established companies as well as start-ups on strategy, organizational capability and business model innovation.