Impact Investing in Context
Overview
It is estimated that by 2020 between $400 billion and $1 trillion dollars will be invested through impact investing. Clearly this new approach to influencing positive social and environmental changes has far-reaching implications.
This 2012 FOX Fall Forum session featured a panel of Julia Sze of Sonen Capital LLC; Mary Mewha of Abbot Downing; John Jonson of Capricorn Investment Group, LLC; and Luther Ragin of Global Impact Investing Network. Topics included:
- Defining impact investing and why it is different from socially responsible investing (SRI) or philanthropy?
- Impact investing as an investment strategy.
- How to benchmark results of an impact investment portfolio not only by financial return but also by social and environment measures.
Some key takeaways:
- Impact investments are made with the goal of influencing positive social and environmental changes.
- Impact investments can mean different things to different people.
- Most people are not aware of impact investing.
- The spectrum of impact investing lies between traditional investing and philanthropy investing: responsible, sustainable, thematic and with direct impact.
- Impact investing can sometimes target returns that meet market rate, i.e. on par with fixed-income returns.
- There is a focus on creating a universal way of measuring social and environmental performance.