NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Friday, June 15, 2018

By Hazel Bradford

Impact investing in emerging markets might be poised for a major growth spurt, as proponents see pension funds and other institutional investors taking an increasing role in a field that largely has been filled by government financial institutions, foundations, and more specialized private equity managers.

Large asset owners are starting to get more interested in impact investing — investments made with companies, organizations and funds that look for measurable, beneficial social or environmental impact, as well as a financial return— in emerging markets partly “because there is a growing recognition of impact investing as a style of investing generally. There are strong returns and very measurable impact,” said Rekha Unnithan, manager of Nuveen‘s $650 million impact investing portfolio, where emerging markets account for nearly 40% of the overall strategy. “They are recognizing that this is not just a niche area.”

David Bohigian, executive vice president of the Overseas Private Investment Corp., said, “I do believe we are at a tipping point for impact investing in emerging markets.”

Photo courtesy of Pablo García Saldaña.