#Throwback: CSRFiles – Impact Investing

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Impact Investing involves building profitable businesses around social problems, such that the business makes money from creating a positive social impact. Traditionally, profitability and having social concerns were perceived to belong to two dichotomous worlds belonging to profit seekers and NGOs respectively.

Impact investing has gained traction over the years and according to the Monitor Institute (2009), the impact investment market could potentially reach US$1 trillion by 2020. It is important to note the role of social enterprise in contributing to the wider economy while addressing the societal challenges that need new and innovative approaches.

Government plays a critical role in the decisions of impact investors. It might not be immediately obvious to the average investor, but governments can make their lives easier or harder, depending on the kind of environment they create for impact investing.

Abigail Noble, the Associate Director and Head of Impact Investing at the World Economic Forum said that it is important to keep in mind that interest does not equal momentum and that for impact investing to have the transformative effect many people expects and hopes it will; we have much to do across sectors and stakeholders.

Thinking about how corporate venture capital syndicates with the growing impact investment community around shared ambitions, objectives and outcomes, it was discovered that impact investors and corporate venture capitalists could both benefit from sharing deal flow, leveraging capital as co-investors, exchanging expertise/distribution channels and mitigating risk with a focus on impact.

Read more in CSRfiles Vol 4 Issue 2 Oct 2014

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