Impact Investors Care about More Than Money

Conventional wisdom says investors focus on financial returns, and philanthropists address environmental and social concerns. Impact investing, combines value and values to provide social and environmental impact in addition to a financial return. Impact investing has the potential to change the world. According to a Forbes guest editorial by Sir Ronald Cohen, Chairman of the UK’s Taskforce on Social Impact Investment, and Matt Bannick, Co-Chair of the U.S. National Advisory Board on Impact Investing, a socially-conscious generation of millennial entrepreneurs is expected to drive a wellspring of impact investment opportunities that address social problems, like unemployment, poverty, crime, homelessness, education, green energy, and much more. Jean Case, of the Case Foundation, sees impact investors as playing an important role, along with the nonprofit and public sectors, in bringing about positive change. Proponents of this philosophy include Mark Zuckerberg and Priscilla Chan, who through their Chan Zuckerberg Initiative, with its mission of ‘advancing human potential and promoting equality,’ have brought impact investing to the attention of the Facebook generation. What’s next? Dennis Price, Writer and Project Director at Impact Alpha, a media outlet for business news of social and environmental value (led by David Bank, formerly of the Wall Street Journal) has six predictions on impact investing in 2016:
  1. The rise of “frontier capital,” or early-stage risk capital in emerging markets
  2. Impact investing will be much bigger and connected to our personal and professional lives
  3. Impact investing will go mainstream, with increased investment by the Ford & MacArthur foundations, as well as BlackRock and Bain Capital
  4. New billionaire philanthropists will continue to redefine how to solve society’s problems
  5. Policy and technology in the areas of fintech, big data, small credit, and alternative analytics will create opportunities for impact
  6. We must dedicate significant resources to impact-centric financial innovation for impact investing to reach its full potential
If we’ve piqued your interest in learning more about impact investing, take a look at Profiles of Impact, a series of case studies produced by The Case Foundation, ImpactAlpha, and of social enterprises, funds, and impact investors that illustrate the wide range of available opportunities. You’re sure to find inspiration in these businesses that, like CEA, are “doing well by doing good.”

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