This week, B Lab released its 2018 list of the B Corps that is considers “Best for the World” in six categories: Community, Customers, Environment, Workers, Governance and Overall. The annual list of top B Corps includes familiar names such as Solar States, Azavea and Communally.
In just one year, the estimated value of the impact-investing sector has roughly doubled. There are now $228 billion in assets under management, according to a recent survey from the Global Impact Investing Network. Will this trend continue on it’s steep slope upward?
Larger organizations that have social impact goals have long since had the resources and access to tools to help them along their journy towards greater impact. However small and medium sized businesses with the same social inclinations have not historically had access to them. That is until organizations in Philadelphia and New York started providing those tools to these business so that they too can monitor and extend the impact which they are able to have on their communities. One of those tools, the Best for PHL assessment as provided by ImpactPHL, attempts to provide these entities with more knowledge and more power to achieve their social goals.
The impact investment industry is growing rapidly, a fact that many of us in the field celebrate. In 2010, J.P Morgan projected up to $1T in investment would be deployed this decade — which would make impact investing twice the size of official development aid to the world’s less develop countries (as defined by the United Nations), presuming historic levels of aid stayed constant since 2010. Many of us are starting to envision a day where we can drop the “impact” moniker and just assume that investments take into account social and environmental factors. But are we scaling the right model? How do we make sure that the blossoming impact investment movement — especially as it starts to supplant traditional aid — actually leads to improvements in outcomes for the people and communities it is supposed to benefit?
The integration of environmental, social, and governance (ESG) factors into the institutional investment analysis and decision-making process is a mega-trend that investors can no longer ignore, says Emily Chew, global head of Environmental, Social, and Corporate Governance Research and Integration at Manulife Asset Management. Speaking at the 71st CFA Institute Annual Conference in Hong Kong, Chew noted that there is a mindshift taking place in the financial industry that has both asset owners and managers increasingly treating ESG investing as part of their fiduciary duty. Further, clients are also demanding responsible investing, seeing it not only as a means of doing good, but also as a way to increase portfolio returns and manage risk.
At the Wharton Social Impact Initiative, we focus on how businesses and finance can be leveraged to drive inclusive economic development. Over the last decade, we have noticed a dramatic increase in the number of investors seeking to achieve financial returns as well as measurable social or environmental impact across their investable assets. This approach to investment – generally known as “impact investing” – takes many forms across asset classes, impact sectors, industries, and geographies. And, the growth in impact investing is leading to a range of partnerships, approaches, and funding strategies.
At the Total Impact Conference in late April, The Philadelphia Foundation and Reinvestment Fund announced a joint initiative named PhilaImpact Fund. This impact investing vehicle will allow each organization’s investors to fund development projects in Philadelphia and the surrounding counties. The PhilaImpact Fund connects investors, philanthropists and engaged citizens with the projects, initiatives and big ideas that generate results on a local level.
The Philadelphia Foundation and Reinvestment Fund announced the launch of PhilaImpactFund, a new place-based impact investment opportunity targeted to the Greater Philadelphia region. The Fund is believed to be a first-of-its-kind collaboration between a community foundation, The Philadelphia Foundation, and an asset manager that also originates community development loans, Reinvestment Fund. This exciting new development offers an opportunity for investors to channel their capital into neighborhood development projects that support regional growth and local initiatives in the communities that need them the most.
Over the past several decades, investors, economists, and business owners alike have acknowledged the need to move from shareholder capitalism to stakeholder capitalism. Research shows that Millennials seek meaningful work and investments that make money and make a difference. And since Millennials represent 50% of the global workforce and will inherit $40 trillion in the coming decades, they will shape labor and capital markets like no other generation. The existence of this trend raises important questions that B Lab's Liz Fernandes explores in this Perspectives piece.
The Total Impact conference is for advisors, family offices, and investors who are interested in aligning their portfolios with their social values. We are bringing together impact investing experts, academics, and development leaders to demonstrate how to incorporate impact into investment portfolios. We believe the financial services industry has the tools to solve some of the world's biggest challenges and we would like you to join us.
The Circle of Aunts and Uncles is a group of 35 members that seeks to build local self-reliance by supporting, mentoring, and providing low interest loans and social capital to aspiring entrepreneurs in Philadelphia. The group has loaned out more than $100,000 since 2015 with priority given to entrepreneurs who demonstrate financial need, are from a historically marginalized population, aspire to implement eco-friendly business practices, and plan to maintain local independent ownership.
Last May, Reinvestment Fund announced a $50 million public bond offering to further its mission to build wealth and opportunity for low-income places and people. The bonds were rated AA- by S&P and represent one of the first examples of connecting CDFIs to mainstream capital markets. Demand for these bonds far exceeded expectations and the offering was oversubscribed. It was a testament to the demand among institutional investors for viable options to channel their capital towards impact, while also receiving market-rate returns.
iFundWomen Philadelphia is a platform designed to help the region’s women entrepreneurs raise the capital needed to get their ideas off the ground. Businesses selected for the Philadelphia Cohort will receive free crowdfunding coaching and have the option to start their crowdfunding campaigns immediately. Women-led businesses in the region are strongly encouraged to apply, and applications will be accepted on a rolling basis.
There’s a collective societal consciousness that thinks of traditional stock and bond markets as prudent and safe while viewing direct investments into businesses and non-profits as risky. The Untours Foundation seeks investments with local and/or societal benefits and makes the case that perhaps the level of risk isn’t so different after all.
How can employers leverage their resources for community involvement in distressed neighborhoods? How does this improve Philadelphia’s economic and civic life? Employers who understand the strength of strategic community involvement are taking notice and leveraging their resources for the betterment of our most vulnerable individuals and distressed communities.
Danone recently released its FY 2017 financial report and announced something important that appears to have never been done before: Danone partnered with 12 leading global banks to lower their loan rates if Danone increases its verified positive impact in the world.
“No amount of philanthropy or foreign aid will solve the problems the world faces” said ImPact CEO Abigail Noble. “We need to use businesses and capital markets”. If you seek profits on a “triple bottom line,” you’re what’s called an impact investor. That means you’re interested in putting money into companies that generate positive social and environmental impact plus financial returns.
Why does ImpactPHL chair John Moore feel so strongly about optimizing investments beyond financial metrics, and Philadelphia’s role as a global hub for such innovation? In volume one, he explains the perspective of ImpactPHL Perspectives.
Margaret Bradley is on a mission to make Philadelphia “the center of the impact investment universe.” Bradley cut her at teeth at The Reinvestment Fund, one of the nation’s top community finance institutions. Now with Ben Franklin Technology Partners, a regional economic development fund, she’s charged with deploying $15 million into Philly startups tackling education, health, other social and environmental challenges.
The chief executives of the world’s largest public companies recently received a letter from one of the most influential investors in the world. And what it says is likely to cause a firestorm in the corner offices of companies everywhere and a debate over social responsibility that stretches from Wall Street to Washington. Laurence D. Fink, founder and chief executive of the investment firm BlackRock, is going to inform business leaders that their companies need to do more than make profits — they need to contribute to society as well if they want to receive the support of BlackRock.
Six ways Philly is moving from Independence Hall to Incubator City
“It’s about how do we create more and better corporate citizens,” said Donovan, program manager and sole employee at ImpactPHL, an alliance of people and organizations formed in July 2016 to enhance the Philadelphia region’s impact economy — where success is measured not just in financial performance, but in contributions to society’s betterment.
Put away that granola bar. As much as Jay Coen Gilbert, co-founder of B Lab, believes in sustainability, good employment, and good environmental practices as key business values, he’s all about profit and ROI, return on investment.
Sister Nora Nash regularly meets with CEOs of big banks, arms makers, and tobacco giants, using her order’s position as a shareholder to fight for change. In an age when corporations are first in line for tax cuts but seemingly unaccountable when an economy sinks or an election tilts, Nash has sought leverage by joining the one group that big companies still have to listen to: shareholders.
Middle America is an engine of innovation. Low-income communities are investable. Immigrants are assets, not liabilities. Inclusive prosperity is a pro-growth strategy. In cities and towns across the U.S. and around the world, business and civic leaders are building local ecosystems to help residents thrive in the global economy. We call them The New Revivalists.
Ben Franklin Technology Partners recently announced that it is partnering with DC-based Village Capital to bring the Village Capital Pathways program to the Philadelphia region. The partnership also includes global financial services firm UBS and will focus its support on African American, Latinx, and/or women founders to help prepare their ventures for potential strategic partners and investors.
Why become a conscious company? Here's an easy answer: Because it's just plain good business.
Implementing conscious business practices isn’t just about doing the right thing or being nice. In fact, the research on the advantages of consciousness just keeps pouring in: self-aware leadership, sustainability, and other companion practices elevate human wellbeing even as they benefit the bottom line. But don’t just take our word for it — here’s the latest evidence of the benefits of becoming a conscious company in infographic format.
As the socially-responsible, ESG (for environmental, social and governance), and impact investing movements have gained steam, so has the number of companies offering products aligned with investors’ values.
Providing low-cost, low-effort personal investment options, U.S. robo-advisorscurrently have more than $100 billion in assets, and are estimated to reach $2.2 trillion by 2020. To differentiate themselves within the market, and attract the 63 percent of millennials who have invested or intend to put money into socially-responsible investments, socially-conscious platforms and investment options are rapidly expanding.
The GIIN’s report provides investors with a comprehensive review of available research to date on the financial performance of impact investments. The report evaluates over a dozen studies—produced by a wide range of organizations—on the financial performance of investments in three common asset classes in impact investing: private equity, private debt, and real assets, as well as individual investor portfolios allocated across asset classes.