Impact investing is about using markets and money for social good. Impact investing is built on the belief that private capital can play a powerful role in solving the massive global challenges of our day, and that capital markets should work for good as well as profit. This vision is realized through investments made into companies, organizations, and funds with the intention to generate measurable social and environmental impact alongside a financial return.
Every month, PCV will give you a roundup of what’s new in the field, what conversations are taking place, and how you can get involved. Here are some highlights from May:
[custom_headline type=”left” level=”h3″ looks_like=”h4″]The Sixth Annual Survey Of Impact Investors[/custom_headline]
With a sample that comprises 158 of the world’s leading impact investors, the 2016 annual survey from our friends at the Global Impact Investing Network (GIIN) provides detailed insight into investor perceptions and a number of key market variables.
Some key findings from this year’s survey:
- Survey respondents committed a total of $15.2 billion to impact investments in 2015 and plan to increase capital committed by 16% to $17.7 billion in 2016
- Fund managers, who play a critical role in the market, raised $6.7 billion in 2015 for impact investing and plan to raise $12.4 billion in 2016
- Nearly 90% of all respondents said the financial performance of their investments was in line with or above expectations (with 19% reporting outperformance), and 99% reported impact performance in line with or better than expectations (with 27% reporting outperformance)
- The most commonly targeted social impact themes were access to finance, employment generation, and health improvement, followed by education and income growth/livelihoods support
- Top targeted environmental impact themes were renewable energy, energy efficiency, and clean technology
See the full findings on the GIIN >
[custom_headline type=”left” level=”h3″ looks_like=”h4″]Aligning Capital With Mission[/custom_headline]
PCV InSight has released Aligning Capital with Mission, the first-ever evaluation of the Annie E. Casey Foundation’s Social Investment Program. The report highlights the strong social impact of the Social Investment program, in alignment with the Foundation’s mission and programmatic goals, while also offering lessons that can support the broader mission investing field.
The report was done with research support from The Center for the Advancement of Social Entrepreneurship (CASE) at Duke University. It draws on PCV InSight’s decades-long experience conducting impact measurement and third-party evaluation for foundations, institutional investors, and our peers in the CDFI industry, and is in keeping with PCV InSight’s commitment to advance the practice of impact measurement throughout the impact investing community. Read the report >
[custom_headline type=”left” level=”h3″ looks_like=”h4″]Making Markets Work For The Poor[/custom_headline]
This special supplement in Stanford Social Innovation Review, prepared by ImpactAlpha and Stanford Professor Paul Brest examines how the Bill & Melinda Gates Foundation uses program-related investments (PRIs)—loans, equity stakes, and guarantees—to complement its traditional grant making. PRI’s can spur entrepreneurs and corporations to pursue new breakthroughs, as well as help to scale up innovative nonprofit business models that make markets work better in low- and middle-income countries. Read the special report on SSIR >
[custom_headline type=”left” level=”h3″ looks_like=”h4″]Seizing The Momentum At Mission Investors Exchange[/custom_headline]
PCV was excited to attend, and lead panels at, the 2016 Mission Investors Exchange Conference in Baltimore. Our friends from ImpactAlpha were also there in a big way, and their overview of the conference is worth the read. It’s time for a new view of foundations as pioneering. Catalytic. Risk-taking. And in the nascent market for investments that generate financial returns through the creation of social and environmental benefits, perhaps essential. In the lexicon of philanthropy, ‘but for’ the emerging network of impact investing foundations, many deals and initiatives would not happen at all. Read their recap at ImpactAlpha >
[custom_headline type=”left” level=”h3″ looks_like=”h4″]Connecting CDFIs To Impact Investors[/custom_headline]
Community Development Financial Institutions (CDFIs) looking to connect with impact investors will have a great new platform this year. A conversation that began between 12 CDFIs about how to access mainstream financial markets has evolved into a full-scale platform that aims to create a marketplace where investors can browse by impact area or geography and connect with a CDFI like Pacific Community Ventures, or CDFI-funded project. ImpactUs promises to simplify and increase the efficiency of the impact investment process. Our friends at OFN interviewed Liz Sessler from ImpactUs to learn more about what CDFIs can expect from the platform. Read the interview on OFN >
[custom_headline type=”left” level=”h3″ looks_like=”h4″]Pay-For-Success Picks Up Election-Year Steam[/custom_headline]
The Senate Finance Committee has held its first ever hearing on evidence-based practices where an important piece of federal legislation, the Social Impact Partnership Act, was a focus, and at the same time the House Ways and Means Committee held a markup on the newly introduced Social Impact Partnerships to Pay for Results Act. The next president has the opportunity to champion policies that leverage highly effective evidence-based, community-driven solutions. As Pay for Success is beginning to take root across the country, this initiative offers new promising focus areas, including higher education, veterans, federal assistance programs, health care, and child welfare. Read more at New Profit >
[custom_headline type=”left” level=”h3″ looks_like=”h4″]Women’s Roles In Leading The Impact Investing Movement[/custom_headline]
With the support of a grant from Mission Throttle — and in partnership with Mission Investor Exchange — The Philanthropic Initiative (TPI) is conducting research on women’s participation and leadership in impact investing. As part of this scan, TPI interviewed leading practitioner Kristin Hull of Green Alpha Advisors and Nia Community Investments on her views of women in the field of impact investing. Read the interview on LinkedIn >
[custom_headline type=”left” level=”h3″ looks_like=”h4″]A Look At Foundations Tapping Their Endowments To Make ‘Mission Investments’[/custom_headline]
Foundations have traditionally kept the management of their endowments separate from their grant-making activities. But things are changing, and the walls between the “two sides of the house” are starting to break down, with some using their endowments to help fulfil their charitable goals. One option is to exclude from the portfolio investments that might be regarded as unethical, such as arms manufacturers, tobacco companies, or fossil fuel-based energy providers. Another method is introducing into their portfolios impact investments. Read more at The Financial Times >