Was ist Social Impact Investing und wie kann man damit anfangen?

The reality is that most people have multiple goals and values, some of which might conflict with each other. As such, it is critically important to understand the desired balance between these preferences. Something that can help with this process is creating a personal impact investments ladder scoring desired investment attributes from 1 to 10, where top desired attributes (financial and non-financial) are scored a 10 and least desired a 1. Once the ladder is constructed, avaliable investments can be compared based on the total personal score, with those getting the highest score becoming top investment candidates. By proceeding in this manner social impact investors will maximize a given investment social and financial utility.

In addition to clarifying your mission and vision, the next practical step is to conduct thorough research on potential investment opportunities. This involves examining the social and environmental impact of companies, assessing their ethical practices, and understanding how well they align with your goals. By delving into the specifics of each investment option, you can make more informed decisions that align with your values and contribute meaningfully to the impact you aim to achieve.

Impact investing capitalizes on the efficiency and infrastructure of capitalism to pursue social and environmental objectives, like job creation, women's empowerment, enhancing nutrition access, and reducing carbon emissions. This approach transcends mere economic gains, targeting a 'triple bottom line.' I view impact investing as a sustainable alternative to both traditional philanthropy and conventional, purely commercial investments focused exclusively on maximizing shareholder returns. Think of it as a spectrum, ranging from 'do no harm' (passive) and ESG compliance (responsible), to an 'impact-first' focus. I humbly suggest that it may well represent the conscious, responsible future of finance.

In my opinion, social impact investing is more than just making money, it's about connecting your wealth with your dream of a better world. By truly understanding what you want and what matters to you, you can create an investment plan that not only makes money but also makes a real difference in areas you care about. For me, the roadmap will be resumed in 6 key steps: 1. Knowing what you believe in 2. Setting clear goals 3. Learning and staying updated 4. Choosing the right investments 5. Getting expert advice and joining groups 6. Regularly checking and updating your investments

Identify Your Passion: Begin by pinpointing the causes close to your heart, be it sustainable agriculture, affordable housing, or innovative health solutions. Your focus areas will be the compass guiding your investment choices.

Understand your comfort with risk and financial expectations. Impact investments offer a spectrum from lower financial returns with higher social impact to market-rate returns with balanced impact. Make sure to start conservative and learn by doing small investments to build your knowledge. I strongly recommend diversifying your investments and make sure to balance risk and reward.

Researching various social impact investment options also opens up a diverse landscape of potential investments that can align with your goals. This exploration is important for discovering innovative and effective ways to invest responsibly. It also allows you to understand the range of impacts your investments can have, from local community development to global sustainability efforts. Engaging with different platforms and intermediaries enriches your understanding and equips you with the tools to make informed decisions, potentially leading to more impactful investments.

La inversion de impacto debe ser lo mas transparente y eficiente posible. No es un tema por tanto exclusivo de ESG, sino de las finanzas 4P, que estan focalizadas en el planeta, las personas, el beneficio a largo plazo y la prosperidad como meta. Con esta vuelta de tuerca, se hace una apuesta por proyectos y empresas que quieren aportar valor a sus usuarios e inversores, ademas de a toda su cadena de valor. El impacto, tiene que ver con como alinear objetivos locales con estrategias globales, y por tanto no fijar exclusivamente metricas financieras, sino mucho mas equilibradas con las personas y el entorno

Local vision: Observe your sorroundings to identify needs/gaps to improve people's lifes. Global vision: join projects of similar nature to make joint efforts and therefore get better results by increasing your geographical reach/impact

Je trouve l’example de l’entreprise KIVA comme un guide excellent de choix d’investissement pour les débutants. Après avoir acquise la compréhension de l’échelle de projets sociales, le choix deviens naturels, souvent réflecteurs sur des valeurs d’individus.

I believe that assessing the impact and performance of the investments is a crucial aspect of social impact investing. This process involves a careful evaluation of both the financial returns and the social or environmental outcomes of the investments. I would approach it focusing on the following aspects: 1. Define impact metrics 2. Select performance indicators 3. Research and data collection 4. Benchmarking 5. Regular review and analysis 6. Balance impact with returns 7. Consult experts and use tools 8. Adapt and adjust

When evaluating potential investments, scrutinize both the financial performance and the intended social or environmental impact. Look for investments that offer measurable and transparent impact metrics. Assessing impact requires understanding how your investment contributes to positive change and aligns with your desired outcomes.

Probably the most important aspect in impact investing. Investment with an impact has to be both objectively measurable "impact factor", as well as an investment reward that provide a sustainable impact for its stakeholders.

One thing I found helpful is about the quality of people we are attracting to work with us. I mean, if we are doing things great, well prepared people will be aware our opportunities and may feel attracted to work on an organization that will help them grow and learn. This is on a social way. on the financial metrics, we will find that our numbers and values will increase, on time, this is very important, because the room of sustainability is the way an organization grows on time. The following aspects could help us know if we are on the right way: 1.- How many people we are attracting to collaborate with us. 2.- How much capital are we attracting from our investors? 3.- Are we having more investors? These are some ideas about it.

I believe that the "Make your decisions and commitments" phase in social impact investing can indeed be complicated. It involves a delicate balance of aligning your financial goals with your ethical values, and making informed choices that reflect both. In my opinion, this phase is not only about selecting the right investments but also about deeply understanding the implications of these choices. It demands a comprehensive evaluation of how each decision aligns with your overarching objectives for both financial growth and social impact.

As I see it, the impact created is more important than the quantum spared by a Company/ Individual in the name of CSR. And especially for a Company, the priority interventions should have a cascading effect especially in terms of economic upliftment.

Continuously monitor the progress and outcomes of your investments. Regularly review their impact on society or the environment as well as their financial performance. Stay engaged with the organizations or initiatives you've invested in, seek updates on their progress, and assess whether they align with your expectations.

To monitor our progress is very important to hear it from our collaborators, this because they know about how are we progressing since they start working with us. Having an annual survey maybe and why not also your candidates for some positions on the organization. Maybe also our suppliers, who are an important part of our organization and may help us deliver valuable strategies. All of these are techniques that help the continuous improvement of our company but also made it sustainability.

For those looking to deepen their understanding and enhance their skills in this field, a few suggestions. Consider enrolling in the pcdn "Investing for Social Impact Professionals" course on Maven. It's an opportunity to connect with like-minded individuals and gain insights from experts in the field. Subscribe to publications such as impact alpha, join relevant networks such Toniic or impact angel groups. There are also many terrific podcasts.

When entering the field of (social) impact investing - to generate positive social and/or environmental impact alongside financial returns - it is imperative for the use of proceeds (of the invested capital) to measurably provide an "intentionality and additionality" referring hereby to the deliberate and purposeful nature of the investments and the additional positive impact they create beyond just financial returns. This is fundamentally different to an ESG investment where the “additionality” of the capital is not addressed.

Keeping up-to-date with the latest trends, challenges, & opportunities in social impact investing is crucial. Regularly reading industry reports & attending conferences has been integral to my ability to provide current & relevant advice to clients in this field For beginners, investing in established social impact funds can be a practical starting point. I advised a corporate client to start their impact investing journey by contributing to a fund that focused on sustainable agriculture, providing them with a diversified & professionally managed portfolio. Participating in relevant workshops & training can enhance your understanding of social impact investing.

Penso ser importante consideramos os casos de insucesso. Aonde estamos errando e como podemos nos ajudar no desafio de consertar o avião durante o voo. Existem muitos trabalhos fundamentados nos casos de sucesso, no mundo onde tudo tende a dar certo. Mas quando as coisas fogem do controle e não sabemos o que fazer? Não é expor fragilidades é demonstrar que somos aprendizes em um processo que tente a se aperfeiçoar continuamente. Mesmo sendo um tema muito explorado, o impacto social, o ESG e qualquer outra variação do tema, ainda há muito o que se desdobrar e acredito que ninguém tem a receita de bolo perfeita para compartilhar.