THOUGHT PIECES AND RESEARCH    

Impact Investing

Want to learn more about impact investing? Skeptical about what the fuss is all about? We've assembled a collection of knowledge pieces that reflect innovation in the field, explain the difference between impact investing and other types of investing and showcase some of the great initiatives that entrepreneurs are building to tackle some of the world's most difficult problems.


Introducing the Impact Investment Benchmark

Views from Cambridge Associates and the GIIN on their Study:

Private impact investment funds — specifically private equity and venture capital funds — that pursue social impact objectives have recorded financial returns in line with a comparative universe of funds that only pursue financial returns.

That’s according to the first comprehensive analysis of the financial performance of private investment funds that have both social impact and financial objectives. The Cambridge Associates Impact Investing Benchmark is developed and compiled by global investment advisor Cambridge Associates in a partnership with the Global Impact Investing Network (GIIN), an organization that seeks to increase the scale and effectiveness of impact investing. The Impact Investing Benchmark will provide performance data on a quarterly basis.

“There’s a view among some investors that impact investing necessarily entails a sacrifice in financial return. However, this data helps to show that is more perception than reality. This Impact Investing Benchmark has exhibited market rate returns — and stronger performance in a number of vintage years, sizes and geographies of focus,” said Cambridge Associates Managing Director Jessica Matthews, who heads the firm’s Mission-Related Investing Group.

“This benchmark lays the groundwork to generate critical financial performance data for the impact investment industry,” said Amit Bouri, CEO of the GIIN. “This demonstrates that market rates of return are achievable through impact investing. We hope this will strengthen the credibility of impact investing for a broader set of investors.”

Key takeaways from the report include:

  • Impact investing funds launched from 1998 through 2004 performed in line with or better than the comparative universe of non—impact investing funds.
  • Emerging market impact investing funds launched from 1998 through 2010 performed in line with emerging market funds in the comparative universe of non-impact investing funds.
  • Emerging market impact investing funds raised between 1998 and 2004 generated a pooled net internal rate of return (IRR) of 15.5%, versus returns of only 7.6% for emerging market funds with those vintage years in the comparative universe.
  • The Cambridge Associates Impact Investing Benchmark includes 51 private investment funds of vintage years 1998 to 2010 that have the specific objective to create positive, measurable social impact and to produce risk—adjusted, market—rate financial returns. The funds included focus on social impact objectives such as financial inclusion, economic development and education. For perspective, Cambridge Associates measured the Impact Investing Benchmark against a comparative universe of 705 funds with no social impact objective in the same industries, geographies and asset classes and of the same vintage years.

View Details

Unlocking the potential for UK-India partnerships in the Healthcare Sector

The potential for a robust UK-India partnership within the healthcare sector is significant. Lessons from the NHS will be increasingly important for India as it moves to introduce universal healthcare over the next 5-10 years. At the same time, the UK stands to benefit by integrating some of the frugal innovation that continues to be developed within the Indian healthcare sector. The growth of the healthcare market in India also provides a unique opportunity for UK medical devices, diagnostics and information technology companies to tap into a consumer base of more than 1.3 billion people provided they can adapt their products and pricing strategies to that market.

View Details

Invest In Social Impact - The Emerging Assets Class

The 2010 JP Morgan Global Research Report on 'Impact Investments - An emerging assets class' stated, "Beyond the opportunity to intervene where government has been unable to deliver products or services, even well-functioning governments and well-resourced philanthropies will always be limited by resources and scope. Impact investment can complement government and philanthropy by providing services to poor communities, thereby allowing government and philanthropy to concentrate their limited resources on reaching the poorest of the poor who cannot participate in market-based solutions".
See more at:
http://www.thenextwomen.com/2011/09/09/invest-social-impact-emerging-assets-class#sthash.ZQsfBDFf.dpuf


View Details

Using Grants to Catalyse Impact Investment

The use of pooled capital as a trigger to unlock larger pools of funds and access to commercial expertise is precisely what needs to take place if social impact businesses are ever going to achieve scale.

View Details

Report from Tällberg Forum 2012

Changing the World through Technology and Innovation – Over the course of four days in June, the 2012 Tällberg Forum gathered leaders, innovators, business executives, researchers and media from all over the world to partake in conversations and meetings about the interaction between humankind and technology.

View Details

From Charity To Change

By Lien Centre For Social Innovation / 23rd July 2015

We believe that charity is good and can do good. In Southeast Asia, the custom of "giving" is widespread, embedded in diverse religious, historical and cultural traditions. However, one of the starting points for this paper is the observation that traditional charity, as it is currently practised in Southeast Asia, is unlikely to lead to the type of changes needed to address large-scale, persistent and emerging social problems in the countries of the region.

View Details

From the Margins to the Mainstream

By The World Economic Forum / 23rd July 2015

Over the last few years, much excitement has been generated around the term "impact investing" - an investment approach that intentionally seeks to create both financial return and measurable positive social or environmental impact. Despite the buzz, there is limited consensus among mainstream investors1 and specialized niche players on what impact investing is, what asset classes are most relevant, how the ecosystem is structured and what constraints the sector faces. As a result, there is widespread confusion regarding what impact investing promises and ultimately delivers.

View Details