PLY: To round off the last SIBNews before the Festive season, two articles which lead on general social investment while making reference to SIBs. One charts how Britain has to date maintained a lead in the field while the other from Barrons discusses the broad trend.
With a break over the holiday season, SIBNews will reappear (presuming there is news!) on December 30th, then pause until January 3rd and finally resume daily publication January 6th.
We wish all our readers a Very Happy Christmas!
It’s rare when America plays catch-up with other countries on matters of business. But when it comes to “social impact investing”, catch-up is exactly what the US is doing.
Social impact investing marries corporations, government and non-profits to make money, and do some good in the process. The reason is simple: governments can’t afford the full slate of environmental and social services, corporations have the money, and non-profits need it.
“I think there’s just a growing a realisation that there’s more money in the private capital markets than we could ever need to meet all the pressing needs in our societies,” said Kippy Joseph, associate director of Innovation at the Rockefeller Foundation.
The British government has long thrown its support behind impact investing, early adopting an increased awareness about big, global issues like climate change, alternative energy, and a crippled social services sector. In 2012, the UK saw the birth of Big Society Capital, a social investment bank that has at its disposal £400m in unclaimed assets from UK bank accounts and a further £200m pounds from the nation’s consumer banks.
How do you ensure that your portfolio, in the search for market-rate returns, isn’t undermining the social and environmental goals of your family’s foundation—or even the next generation’s heart-felt concerns? The answer, increasingly, is the small but fast-growing “social-impact investing” sector.
Social-impact investing differs from “socially responsible investing” (screening funds for, say, alcohol or weapons stocks) or even venture philanthropy (funding management improvements at charismatic nonprofits, so they can roll out their services to larger numbers of people.) Social-impact investors instead seek companies that generate measurable social or environmental impact—and earn decent financial returns in the process.