David Braham (Founder at Braham Consulting / Regional Manager at Campden Wealth), Dan Mapes (CEO & Founder at Verses Technology), Giles Gunasekara (CEO of Global Impact Initiative), Damian Hajda (Executive Director at Social Suite)
As you may be well aware, Tat Capital and Forming Impact has launched Tat Impact with a combined mission to do better business by promoting impact investing across mid-market firms. As part of this endeavor, we completed our second Masterclass on November 9/10 with the focus on what 'Actions' should be taken to promote Impact Investing.
This session highlighted the actions to be taken to promote growth and equality of Impact Investments for all stakeholders. Over to the summary:
- Start investing with purpose and bring more capital to impact investing.
- Better use of technology is helping big corporations streamline and do more with less. This is one of the biggest advantages of impact investing.
- The new global digital economy is bringing in a new age industrial economy.
- Challenges faced – how do we align impact investing to company goals; is the timeline realistic; what is expected from impact investing; what do we want as outcome; how do we add incentive to it.
- Over the last 5-10 years, Impact investing has been a buzzword: with millennials wanting investment alongside social and ethical principles /wanting their capital to be used more efficiently.
- Investment has long been in the hands of bankers and asset/investment managers and must be taken back by the entrepreneurs and capital holders. It is only when both these parties define what they want to achieve, ideal impact investment can be achieved.
- It is important to identify what we are measuring & have the right benchmarking.
- Understanding the journey and the role of the Investor and various stakeholders is vital.
- Social Impact Measurement is priority to bringing integrity to the work; attracting more stakeholders eventually. Measuring impact encourages us to stay true to who we are and why we exist.
- Moving away from traditional investing to impact investing has increasingly shown more gender equality and a strong access to affordable housing, education and water; sanitization to people; better outcomes and more opportunities.
- Use of limited technology wisely could help promote and make impact investing deployable and result in greater social, environmental, and cultural change.
- European investors have always had a much higher social conscience and therefore every pension fund north of Paris has an exposure to impact investing and is going upscale.
- The Financial Times reported global impact investment market is worth more than half a trillion dollars at US$502 billion.
- Impact-weighted accounts would result in a better understanding of the societal and environmental effects of ESG investing. It would also provide a scalable, replicable means to compare invested funds and reduce diligence and costs.
- Key take-aways:
- Social responsibilities – Impact investing allows investors to align personal values with investment objectives alongside social, environmental and governance related issues.
- Implementing impact investing within the organisation is the first step. We must start, irrespective of the government policies on this matter.
- It allows to co-create together - investing and returns alongside societal responsibility.
- Co board - stakeholders vs shareholders.
- Has to be built on foundation and trust.
- Increased emphasis on more programmes to highlight Impact investing.
- In this pandemic, the most important look out was human capital and that shows how important that aspect is despite limited resources, investments, profitability, etc., being factors that affect business.
- Working through the challenges, not just doing your social responsibilities.
- Embrace impact within your organization and foster it to grow further.
- Co boards - focus how to bring more impact to the boardroom.
- In India, 2% of all corporate responsibility goes into impact investing - use such mandatorily available funds to mobilize and strengthen impact investing.
There has been a positive shift towards Impact investing as more and more people are becoming aware of the environment and society. The increased profitability of businesses giving 'Impact' priority has also started to popularise it, as realisation dawns that Impact investing need not mean letting go of profitability.
If you wish to know more, feel free to write to us with any questions you may have.