What is Impact Investing?
Hopefully the video above gave you good insight on what impact investing is. As described by the Global Impact Investing Network, "Impact investments are investments made with the intention to generate positive, measurable social and environmental impact alongside a financial return." Impact investing has been proven to meet or exceed investors expectation in both financial regards and in social and environment impact. To put it in simple terms, the overall goal of impact investing is to maximize financial returns while having a positive social impact on society. No one side is more important, but the combination of the two is the goal of impact investing. Impact Investing is for the future and a new and improved way of helping society while making money. It is really a win-win situation. While only 30% of affluent baby boomers use impact investing, 77% of affluent millennials do, proving how big of an industry Impact Investing is becoming. Below is an infographic showing a few of the problems impact investing is working to solve.
Real World Examples:
An example of impact investing in the real world is SNS Impact Investing who used debt by offering a USD 3 million loan through two fund to Pro Mujer Bolivia. The overall goal and purpose of the investment was to expand Pro Mujer Bolivia's working capital so it could increase the number of clients at the BoP served. This allowed and provided financial services to the poor who had limited access previously. The result of this transaction was a win on both ends of the investment. |
Another example is General Electric, a very popular company here in the United States who exists in many different industry's. GE provided a 1 million dollar loan to Burn Manufacturing. Burn Manufacturing makes sustainable burning stoves for families in Africa. GE also created and provided 20 million dollars to Accelerator to aid with scaling and commercializing ideas. Accelerator has partnered with companies combating carbon capture and efficiency in energy extraction and distribution. |