Impact Investing Series
The Ethics of Impact Investing: Non-Consequentialist Concerns
The Global Impact Investing Network (GIIN) defines impact investing as ‘investments made into companies, organizations, and funds with the intention to generate social and environmental impact alongside a financial return.’[2]While impact investing is a relatively new term—coined at a 2007 conference convened by the Rockefeller Foundation—the concept of directing investments towards social outcomes is not. The precedents of socially-oriented investment include religious communities, such as Quaker codes of ethics in 17th century England;[3] more traditional forms of philanthropic giving;[4] divestment from morally objectionable institutions, such as those of apartheid South Africa;[5]and more recent frameworks of ethical finance such as socially responsible investing, social entrepreneurship, and sustainable finance. READ MORE…
Big Data and Impact Investing
The financial industry is into both big data and impact investing. The enormous volume of big data created every day, and associated innovations in analytics are revolutionizing effectiveness and measurement of impact. Crucially, big data can be used to more accurately and comprehensively assess companies’ social and environmental impact. This allows investors to be confident about the actual effects their investments are having, and consider non-financial factors without necessarily compromising on returns. At present, the contribution of big data is limited for reasons like a lack of data, and concerns about privacy and correct data use. READ MORE…
Philosophical Foundations of Impact Investing
As pointed in our earlier piece, impact investing is about good profits: making money while doing good. Impact investing reminds us sound monetary returns and positive socio-environmental impact returns are not mutually exclusive, but can be complementary and even mutually enhancing. Here are the philosophical reasons why. While financial initiatives in favour of investments for social good emerged in the 1980’s, the impact investing label gathered momentum in the early 2000’s, especially from the onset of the 2008 global financial crisis. READ MORE…
Impact Investments: Good Profits?
Investors with high ethical standards can be constrained by the corporation’s duty to maximize shareholder profit. Pure nonprofits may disappoint with their low returns. A new way of doing good and making money is called impact investing. Impact investments provides funding opportunities for both social and financial returns. The main advantage of impact investments is its ability to capitalize on governments’ and charities’ lack of monetary resources. As a financial method, it has tremendous potential to solve pressing world issues. READ MORE…
Impact Investing: Big Society Capital
Is it possible to address the world’s social problems while still making a financial return? Impact investing seeks to achieve this goal. Big Society Capital is a wholesale investment bank that invests in social investment intermediaries, which then invest in social enterprises and charities to address social issues. Impact investing is increasingly popular but faces several challenges. READ MORE…
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