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

Friday, February 23, 2018

Is impact investing reaching a tipping point? Multiple signs point to growing momentum.

First, more investors are deploying more capital towards impact. The Global Sustainable Investing Alliance reports nearly $23 trillion of assetsbeing managed under socially responsible investment strategies globally. And the 200+ impact investors reporting to the GIIN’s annual survey have more than $114 billion worth of impact investing assets under management, nearly double the amount reported in 2015.

Second, specific impact investing markets are reaching greater maturity. In India, there is now a robust ecosystem of private equity investors — such as Elevar, Aspada, and Aavishkaar –focused on scaling solutions for low income communities in sectors such as financial inclusion, housing, and agriculture. A 2017 market study revealed growing evidence of such investors generating impact alongside strong financial returns — a sample of 48 impact investing exits included companies reaching large numbers of low income customers, and yielded a median IRR on par with wider market benchmarks.

Photo courtesy of Martin Fisch.